FAQs

Nonresident Aliens for Tax Purposes
Students
Visas
U.S. Citizens and Permanent Residents for Immigration Purposes
Tax Identification Numbers (SSN and ITIN)
Paying Taxes to the Internal Revenue Service

Nonresident Aliens for Tax Purposes

Who is considered a nonresident alien for federal income tax purposes?
There are two tests to determine whether a non-U.S. citizen is treated as a resident alien for tax purposes. The first test is the "green card" test test and the second test is the "substantial presence" test. If a foreign national is in the U.S. less than 31 days, it is not necessary to count days towards the substantial presence test. If a foreign national is in the U.S. for 183 days or more, the person may become a resident alien in the U.S. depending on several factors. Generally, an F-1 visa holder is exempt from counting days towards the substantial presence test for 5 calendar years. An F-1 will become a resident alien in his/her 6th calendar year after having been in the U.S. for 183 days. A J-1 visa holder is exempt from counting days in the U.S. for 2 calendar years. He/she will become a resident alien after reaching 183 days in their 3rd calendar year. These are general rules and the actual calculation is more complicated and depends on many factors including immigration status and previous visits to the U.S.

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What is the difference in taxable income between individuals classified as resident and nonresident aliens for tax purposes?
Resident aliens are taxed just like U.S. citizens and are subject to U.S. tax on their worldwide income. Nonresident aliens are taxed on a slightly higher scale for wages and may be subject to a flat rate of tax on other kinds of payments (such as scholarships). However, nonresident aliens are taxed on their U.S. source income only.

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What types of payments constitute income for an individual classified as a nonresident alien for tax purposes?
All U.S.-sourced payments to the nonresident alien are subject to federal taxation, unless an exception applies. These payments may include, but are not limited to: awards; compensation; consulting fees; honoraria; royalties; scholarship/fellowship; stipend; and wages.

Students

Does an international student in an F-1/J-1 immigration status have to file any forms with the U.S. government?
Yes. All international students classified as nonresident aliens for tax purposes must file Form 8843 every year, whether or not they were employed or received taxable payments in the U.S. during the reporting year. In addition, dependents in F-2 and J-2 status must also complete and file Form 8843.

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Is a teaching assistant or a research assistant the same as a scholarship or fellowship?
No. TA or RA salary payments are not considered scholarships or fellowships. Income from TA and RA positions is considered earned income (wages) and is taxable.

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Are international students exempt from U.S. taxes?
No, international students are not exempt from U.S. taxes. A tax treaty between the U.S. and an international student's country of tax residency may reduce the U.S. taxes owed.

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Do students have to pay taxes on a scholarship?
It depends on the source of the scholarship. If the student is  a nonresident alien and the scholarship is not from U.S. sources, the scholarship is not subject to U.S. tax. If the scholarship is from U.S. sources or the student is a resident alien for tax purposes, the scholarship is subject to U.S. tax according to the following rules. If the student is a candidate for a degree, the part of the scholarship used to pay tuition, fees, books, supplies and equipment required by the educational institution may be excluded from taxation. However, any part of the scholarship used to pay other expenses, such as room and board, is taxable.

Visas

What should a foreign national student on either an F-1 or J-1 visa do if their visa has expired?
If a foreign national student's visa has expired, the person's legal status in the U.S. is not affected. The person's status is linked to the validity of his/her passport, the I-94 card, and the I-20 or DS-2019 expiration date. The visa (F-1 or J-1) is an entry/re-entry permit and only needs to be valid if the student travels out of the U.S. and must return. If this is the case, and the student's visa has expired, the student must have his/her visa renewed outside of the U.S. at a U.S. embassy or consulate.

U.S. Citizens and Permanent Residents for Immigration Purposes

Do citizens and lawful permanent residents of the U.S. need to prove they are eligible to work?
Yes. While citizens and lawful permanent residents of the U.S. are automatically eligible for employment, they must complete a Form I-9 and submit required documents for employment verification.

Tax Identification Numbers (SSN and ITIN)

What should a foreign national do if he or she is unable to get a Social Security Number for a spouse or dependent child?
If the foreign national's spouse or dependent is not eligible for a Social Security Number, application must be made for an Individual Taxpayer Identification Number (ITIN). To apply for an ITIN for a dependent, fill out Form W-7.

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Can a foreign national from a tax treaty country who is allowed to claim an exemption for a spouse and/or child do this if their spouse and/or child doesn't have either a Social Security Number or an ITIN?
No. In order to claim personal exemptions for dependents they must have a valid Social Security Number or ITIN. To apply for an ITIN for a spouse or dependent, fill out Form W-7.

Paying Taxes to the Internal Revenue Service

Does a foreign national who is a nonresident alien for tax purposes who only worked for a very short time in a calendar year and didn't earn very much still have to file a tax return?
Yes. A nonresident alien for tax purposes who had any U.S.-source earned income or received a taxable scholarship payment(s) must file both the Form 1040NR or 1040NR-EZ and Form 8843. Nonresident aliens are generally subject to tax on U.S.-source income only.

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Does a nonresident alien from a country that has a tax treaty with the U.S. who earned below $5000, which is the amount of wage exempt by the treaty, still need to file?
Yes. The nonresident alien must file Form 1040NR-EZ or Form 1040NR. In the case where the person earned more than the exempt amount of the tax treaty, both a Form W-2 and a Form 1042-S will be sent.

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What happens if a nonresident alien for tax purposes fails to file a tax return?
If a nonresident alien for tax purposes owes taxes and doesn't file, the IRS can assess penalties and interest and seize U.S. bank assets for repayment. Fines and penalties can often amount to more than the original tax debt. In addition, there can also be immigration consequences for failing to file taxes. Applicants for adjustment of status to either H-1B or lawful permanent residency are frequently asked to show proof of tax filing for previous years in the U.S.

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Should a foreign national keep copies of tax returns and other tax forms?
Yes. Everyone should always keep copies of tax returns, W-2, 1042-S, 1099 bank interest statements and any other pertinent forms as proof of filing. The IRS can audit individual returns for up to 3 years following the filing deadline and an individual's tax records are essential in proving his or her case.

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What is the deadline for filing a tax return?
For filing Form 1040NR-EZ or Form 1040NR, the deadline is April 15. For filing Form 8843 only, the deadline is June 15.