Foreign National Tax FAQ
Do I Need to File Tax Forms? YES!
Q. As a foreign national student with no income or scholarships do I need to file tax forms?
A. Yes. You are required to file form 8843 with the IRS to claim that you are exempt due to the fact that you have not been in the United States long enough to be subject to withholdings.
Q. F-1 and J-1 students and J-1 scholars are "exempt individuals." Doesn’t this mean we don't have to pay taxes?
A. "Exempt individual" means you are exempt from counting days toward the "substantial presence" test - generally for five years if you are a student and two years if you are a scholar. It does NOT mean you have no tax obligations.
Q. I am a graduate student with a research or teaching assistantship which pays my tuition, fees and living expenses. Since this is part of my studies, it is not really employment and therefore, not taxable right?
A. Graduate Assistantships are fully taxable as income received in return for services performed. Graduate assistants may not exclude tuition and fees that are considered payment for services. However, service-free tuition awards may be excluded from taxation. For more information, consult IRS Publication 519.
Q. The government will automatically take the appropriate amount of taxes from my salary, so I don't need to take any further action after completing Form W-4 right?
A. The U.S. tax system is based on self-reporting of income. The W-4 instructs your employer to withhold a certain amount each pay period toward your tax liability. However, this may not end up being the exact amount you owe. At the end of the tax year, you must file an income tax return to determine if you will get a refund of some or all of what was withheld from your paycheck, or if you owe additional money.
Q. My country has a tax treaty with the U.S. so I don't have to pay any taxes.
A. A treaty does not generally exempt an individual totally from taxation. Usually only a portion of income, or income from certain activities, is exempt. It is important to read IRS Publication 901 and/or the treaty itself to obtain full details on your exemption.
Q. Am I required to file state taxes?
A. Yes. If you have earned income and state income tax has been withheld, you will need to file state income taxes.
How Do I File My Taxes?
Q. I don’t know anything about tax law and I am unsure what to do about my tax return filing?
A. You do not need to know anything about tax law. The International Studies Office (ISO) and Compliance & Immigration Services (CIS) will provide you with a program called Foreign National Tax Resource (FNTR) to prepare the correct forms that you will need to send in for the tax return.
Q. When will the FNTR program be available for 2013 tax return processing?
A. FNTR should be available mid-February. The regular filing deadline is April 15, 2014.
Q. What forms will I need to complete my tax return?
A. If you claimed tax treaty benefits in the previous tax year, or, you received scholarship/fellowship payments the Compliance and Immigration Office will send you a form 1042-S. If you did not have a tax treaty and received pay for working at the University then you will have a W-2, which is available under the Employee Self-Service (SSTL).
Q. I am in the U.S. in non-immigrant status. Therefore, should I file as a Nonresident Alien?
A. Maybe. Individuals who are in non-immigrant immigration status may be Resident Aliens for tax purposes if they meet the "substantial presence" test. Resident and Nonresident status for immigration and taxation purposes are not necessarily the same.
Q. All my friends are filing income tax Form 1040EZ, which is much easier than from 1040NR. Can I use this form too?
A. Maybe. You can use the 1040EZ only if you are a resident for tax purposes. Form 1040EZ can only be used by those who are U.S. citizens, permanent resident aliens or residents for tax purposes. Non-residents must use form 1040NR or form 1040NR EZ.
Q. What is an ITIN?
A. An ITIN (Individual Taxpayer Identification Number) is issued by the IRS for the sole purpose of filing tax documents and does not give the holder work authorization like a Social Security Number. A student who has scholarship income in the US but is not working would be eligible for an ITIN. When submitting the W-7 to request an ITIN, DO NOT submit your passport with your application. The ISO can provide you with a certified copy of your passport. You can submit the W-7 and the 8843 at the same time.
Q. How do I apply for an ITIN?
A. Students who would like to apply for the ITIN can submit form W-7 to the IRS. It can take several months before the IRS gets back in touch with a new ITIN after the submission of the W-7. So it is also possible to attach your tax return to the W-7 application if you wish to file in a timely manner with an ITIN.
Q. Do I need to submit my ITIN to University of Virginia?
A. Yes, after you have received your ITIN you will need to submit form W-9 to the Office of Compliance & Immigration Services so that the information can be updated in the tax reporting system.
Q. I/My parents are receiving tax forms from the university. Why?
A. Please contact Logan Hobbs, UVa’s Foreign National Tax Consultant, for further information.
I STILL HAVE QUESTIONS, WHERE SHOULD I GO FOR HELP?
Q. Where can I go for further assistance?
A. If you have any questions please email Logan Hobbs at firstname.lastname@example.org , call (434) 924 -1377, or visit at 914 Emmet St.