U.S. Tax Information for International Students
This page is for informational purposes only and should not be considered financial or legal advice. Please consult your own tax or financial advisor with any questions.
U.S. taxes are complicated and tax laws change frequently. The Slater International Center staff can provide you with basic information and guidance on tax issues, refer you to helpful Internal Revenue Service (IRS) publications and forms, and give you access to an online non-immigrant tax preparation product called Sprintax
Overview of U.S. Taxes
In the United States, there are several different types of taxes: Federal, state, and social security/medicare (FICA) taxes. The U.S. tax year runs from January 1st to December 31st. The Treasury Department & IRS announced that the federal filing deadline has been extended to May 17th, 2021, and the Baker-Polito Administration announced that Massachusetts State Tax deadline has also been extended to May 17th, 2021. Please review the Internal Revenue Service and Massachusetts State websites for details. The earliest that taxes may be filed is February 12, 2021.
Federal income taxes are prepaid by the employer(s) based on the estimate of liability provided by the employee on her Form W-4 (completed by the employee at the time of hire). The taxes paid by the employer are then withheld from the employee’s paychecks.
The process of “filing a tax return” allows you to reconcile the amount of taxes that you had withheld from your income during the year with the actual amount of taxes that you owe the U.S. government. Since withholding is only an estimate, employees are given this yearly opportunity to file a tax return with the IRS. In some cases, filing a tax return results in a refund from the IRS because the amount of money withheld was higher than necessary. However, sometimes filing a tax return results in a payment when there was not enough withheld and the individual must send a payment to the IRS with his/her tax return.
Federal tax forms should be mailed to:
Department of the Treasury
Internal Revenue Service Center
Austin, TX 73301-0215
Individuals living in Massachusetts may need to file a state tax return if they received any U.S. income while living in the state. If you earned more than $8,000, you must file state Tax Form 1-NR.
State tax forms should be mailed to:
Massachusetts Department of Revenue
(P.O. Box 7000 for a refund) or (P.O. Box 7003 for a payment)
Boston, MA 02204
These taxes support U.S. retirees and the disabled. Non-Residents in F, J, M or Q status are exempt from these taxes while they are considered “non-residents” for tax purposes. If you have been in the U.S. for less than 5 years as an F-1 student you are probably a “non-resident” for tax purposes and exempt from social security taxes. For more information on FICA for Nonresidents:http://blog.sprintax.com/fica-
Non-residents, for tax purposes, are taxed only on their U.S. source income. With a few exceptions, this means that any income received from outside the U.S. is not considered taxable in the U.S. Residents, for tax purposes, are taxed by the U.S. on their income from anywhere in the world.
Sources of U.S. income may include financial aid, on-campus employment, practical or academic training, scholarships, fellowships, and any other compensation received for labor. “Income” is not limited to wages paid in cash, but also includes any portion of a scholarship, fellowship, or assistantship from a U.S. source that is applied to housing and meal expenses. The portion applied to tuition, fees, and books is not considered income. If scholarship money is provided directly to the student by check or cash, however, it is fully taxable even if the student intends to use it to pay for tuition, fees, and/or books.
Scholarship and fellowship payments made to international students are subject to a 14% federal tax withholding. Tax treaty provisions may allow an international student to claim exemption from federal taxes on teaching assistantships and fellowships. The IRS requires the College to report scholarship and fellowship payments to international students on a Form 1042-S. International students that receive a scholarship or fellowship are required to file a tax return using the information provided on Form 1042-S.
Prizes made to non-resident aliens are subject to a 30% federal tax withholding. Tax treaty provisions may allow non-resident aliens to claim exemption from federal tax withholding on prizes. The IRS requires the college to report prize payments to non-resident aliens on Form 1040NR each calendar year using the information provided on the Form 1042.