Federal Taxes for International Students

Transcription

1 Federal Taxes for International Students Office of International Students Updated 2/18/15

2 Why File an Income Tax Return? It is the law! Compliance with U.S. visa requirements Get a refund of withheld taxes Pay additional taxes if they are owed

3 How Taxes Work TAX RETURN INCOME Employment Graduate Assistantships Scholarships TAXES Taxed scholarship/treaty benefits= 14% Employment= amount depends on how often you are paid and your wages. Used to determine the amount of tax you paid vs. the amount of tax you owed. Determines whether you owe more tax or if you are owed a refund.

4 Resident vs. Nonresident Resident alien Been in the U.S. for more than 5 calendar years, then determined via Substantial Presence Test. Current Year Days x1, plus 1st Previous Year Days x1/3, plus 2nd Previous Year Days x 1/6. If total equals 183+, you are considered a resident for taxes Cannot use GLACIER Tax Prep to file 1040/1040-EZ Nonresident alien Been in the U.S. for less than 5 calendar years If no income (no employment/no scholarships)-form 8843 If income- Form 8843 and 1040NR/1040NR-EZ

5 Basics International students need to file tax documents to the U.S. Internal Revenue Service (IRS) All students on F-1 or J-1 visas who have been in the United States for any time during F-1 or J-1 students who received any income within the United States or taxable scholarships from U.S. source. Money earned from OPT/CPT is also taxable. Filing your tax documents is mandatory!

6 If you do not file a tax return You may get into trouble with the IRS If taxes are owed and not paid, the IRS can charge a penalty and interest, and seize the money from bank accounts you have in the United States Filing incorrectly can be just as costly! The right software and tax forms can help you file correctly. Use GLACIER Tax Prep! Beware of Turbo Tax (or similar programs) as a non-resident!

7 How to file your tax returns Using GLACIER Tax Prep is the best way! GLACIER Tax Prep requires an access code. Obtain an access code by visiting OIS front desk or ing OIS has free access codes for only 399 students. Nonresidents cannot file electronically! GLACIER Tax Prep helps you prepare electronically, but you must print and send hard copies. All students must file by April 15, 2015!

8 Understanding your tax forms W-2 If you were employed in 2014: W-2 form issued by employer Mailed to your local address Available under my.emich.edu, if EMU was your employer

9 Understanding your tax forms 1042-S You will get a 1042-S: If you had more than one scholarship that exceeded your tuition costs If you were awarded scholarships that included tuition, PLUS room/board (EMU athletes mostly) If you had income and tax-treaty benefits ******************************************************** Should have received in the mail (local address) If you have questions about the 1042-S, or you are eligible for a 1042-S but didn t receive one, contact Payroll at [email protected].

10 Form 1042-S

11 Understanding your tax forms 1098-T Form1098-T (statement of tuition and fees paid). Used to claim credits. Nonresident aliens (in U.S. for less than 5 years) CANNOT claim this in order to get return on tuition/fees.

12 Understanding your tax forms 1099INT: from a bank for interest earned on checking or savings accounts. 1099DIV: Interest earned on investments. Tax Prep.

13 SSN and ITIN Social Security Number (SSN) If you have employment, you must have an SSN Individual Taxpayer Identification Number (ITIN) If you have a taxable scholarship, but no income from employment, you need to request an ITIN. You can apply for an ITIN when filing your return. GLACIER Tax Prep will issue you Form W-7 with your other tax documents if it recognizes that you will get a return. Must submit a certified copy of your passport with Form W-7 AND an ITIN letter from OIS. ITIN is only for tax purposes. Cannot be used in place of a SSN. Read the GLACIER Tax Prep filing instructions CAREFULLY!

14 When is best to file As soon as you have all necessary documents and forms, you can file! Different forms are issued at different times, but all must be in-hand when you file. File before April 15, 2015 (earlier is best).

15 Instructions Read Obtain access code Read instruction sheet Go to to begin/create log-in Use your GLACIER account from last year (if you had one) If cannot remember previous one, select Forgot Login Collect tax forms and immigration documents Return as needed to complete process When complete, mail tax documents according to instructions (mailing address included on instructions).

16 Creating your account

17 Enter Biographical Information Enter name according to SSN/ITIN, or passport if you don t have SNN/ITIN Country of Tax Residence: U.S. not an option. Typically, your Country of Tax Residence is the same as you Country of Permanent Residence; however, if you have lived in a country other than your Country of Permanent Residence immediately before coming to the U.S. to study/work, you may have established Tax Residency in that country.

18 Step 1: Determine Residency

19 Enter information about your visits

20 Verify information from previous screen

21 Results of resident status

22 Enter Income Add all the forms you received. Click this if you did not receive any forms/did not have income in 2014.

23 Enter Applicable Forms

24 FICA Taxes- Social Security/Medicare FICA Taxes?

25 FICA Taxes

26 Withheld Social Security and MedicareHow to get it back Contact Employer first (by /mail better than verbal) Form 843 Supplemental form 8316 Publication Page 43 Refund of Taxes Withheld in Error

27 Tax Treaties

28 Step 3: Address- need to be able to receive mail here (even in 3-4 months!)

29 SSN or ITIN Double check for accuracy!!!

30 Designated School Official Information Already entered for you. Do not change.

31 Step 4: Generate and Print Forms If due a refund, choose payment option Check will be in $USD and will take 4 more weeks than deposit.

32 Direct Deposit Option Double check numbers! Cannot be a foreign bank. U.S. government will only deposit once!

33 Married? If yes, you need to file 8843 forms for them. If they had jobs, they need to file on own.

34 Spouse/Children in U.S.?

35 Additional Information

36 Forms

37 Common Misconceptions Eligibility for treaty benefits exempts one from filing a tax return= NO Nonresident aliens are eligible for education credits= NO Nonresident aliens can use Turbo Tax, H & R Block,Taxslayer, etc.= NO It is ok not to file the 8843= NO Definition of word Resident Immigration definition U.S. income tax definition Tuition purposes definition

38 Remember Read and follow ALL instructions, including copies of documents for ITIN request Print and sign Make copy and keep for 4 calendar years Mail to address given on instructions! You cannot file electronically!

39 Mailing to the IRS Your Name and Address Stamp (Lobby Shop) 46 cents/stamp Internal Revenue Service Address, per Instruction Sheet

40 Tips for an easier filing Read and utilize resources! OIS website Use GLACIER Tax Prep buttons- Help, More Info Use the GLACIER Tax Prep Frequently Asked Questions Watch tutorial video on your main menu Start early. You don t need to complete the process at one time. You can return and continue filing. Be sure to mail by April 15, 2015 Can take up to 4 months to get your tax return (if you are due money)

41 Utilize Support Options More Info FAQs Help- Best way!!! Video

42 Help to Support Center Generally answer within 24 hours. No phone support available.

43 State of Michigan Taxes Prepare your federal tax form first. If you only file Form 8843, you are not required to file a State of Michigan Tax Form. If you file 1040NR-EZ, look at Line 10 (Adjusted Gross Income). If the amount listed on line 10 is less than $4,000, you are not required to file a State of Michigan tax form. If you file Federal Form 1040-NR look at line 7d (total number of exemptions). Multiply line 7d by $4,000. If the result is greater than the amount on Line 36 (Adjusted Gross Income), then you are not required to file a State of Michigan tax form. If you are required to file a State of Michigan tax form (MI 1040), you should also file Schedule NR. If you are due a refund, you may want to file even though it is not a requirement.

44 If you have questions BEST RESOURCE- GLACIER Tax Prep Office of International Students Julia until mid-march), Emily all tax season) Walk-In advising for Julia or Emily Make appointment EMU Payroll Office, Internal Revenue Service

45 Any other questions?

46 THANK YOU!