International Students: Federal Eitc Eligibility Explained

The Earned Income Tax Credit (EITC) is a refundable tax credit for low- and moderate-income working families. To qualify for the EITC, you must be a U.S. citizen or resident alien all year, have a valid Social Security number, and meet certain income requirements. International students on F-1 visas are typically considered nonresident aliens for tax purposes and are only taxed on U.S.-source income. So, do international students qualify for the federal EITC?

International students on F-1 visas are considered nonresident aliens for tax purposes

It is important to note that the classification of "resident alien" for tax purposes does not equate to legal residency status. International students on F-1 visas can be considered 'residents' or 'resident aliens' for tax purposes if they pass the Substantial Presence Test. This test determines residency status for tax purposes, and if an international student meets the criteria, they will be taxed as a resident.

To be eligible for the Earned Income Tax Credit (EITC), an individual must be a US citizen or a resident alien for the entire tax year. Additionally, they must have a valid Social Security number. While a Social Security number is not required for non-citizens to claim the EITC, they cannot file their taxes with an Individual Taxpayer Identification Number (ITIN). However, they may be able to claim the state EITC with an ITIN in certain states, such as California, Colorado, and Washington.

Furthermore, the EITC has specific requirements regarding income and dependents. To qualify, an individual must meet certain income thresholds, which vary based on filing status and the number of children claimed. The EITC is designed to benefit low- to moderate-income workers with qualifying children. However, it is important to note that there are exceptions, and individuals without qualifying children may still be eligible for the EITC if they meet certain conditions.

International students are taxed on US-source income only

International students in the US on F-1 visas are considered nonresident aliens for tax purposes for the first five calendar years of their stay. This means that international students are taxed on US-source income only.

International students are required to file a US tax return (Form 1040-NR) for income from US sources. Even if an international student does not earn money during their time in the US, they will still need to file Form 8843 with the IRS by the deadline of April 15. Additionally, depending on the state, a state tax return may also be required.

To be eligible for a US social security number (SSN), international students must apply for one. If an international student is receiving funds from their university and is not eligible for an SSN, they must apply for an Individual Tax Identification Number (ITIN).

The Internal Revenue Service (IRS) uses the substantial presence test to determine whether an individual who is not a US citizen or permanent resident should be taxed as a resident or a nonresident alien for a specific year. If an international student passes the substantial presence test, they will be considered a resident for tax purposes and taxed on their worldwide income.

It is important to note that the Earned Income Tax Credit (EITC) is only available to US citizens or resident aliens. To claim the EITC, an individual must meet certain income requirements and have a valid Social Security number.

International students must fill in a W-4 tax form with a new employer

International students in the U.S. are typically classified as nonresident aliens for tax purposes. As such, they are required to fill out a W-4 tax form with their new employer. This form must be completed in accordance with the special instructions outlined in Notice 1392, Supplemental Form W-4 Instructions for Nonresident Aliens.

It is important to note that nonresident alien employees are subject to different tax withholding rules than U.S. citizens or resident aliens. These rules are detailed in Chapter 9 of Publication 15 (Circular E) and Publication 515, "Withholding Taxes on Nonresident Aliens". Additionally, some nonresident aliens may be eligible for exemptions from federal income tax withholding on wages due to tax treaties. To claim this exemption, they must file Form 8233, "Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual", with their employer.

International students who become resident aliens of the United States for tax purposes may be able to exempt part or all of their U.S.-source wages from U.S. taxation, depending on the provisions of the applicable tax treaty. In such cases, their wages should be reported on Form W-2, with block 2 (Federal Income Tax Withheld) showing zero or a reduced amount of federal income tax withheld due to the tax treaty exemption.

It is worth noting that international students may also be eligible for certain tax credits, such as the Earned Income Tax Credit (EITC), if they meet the eligibility requirements. The EITC is a refundable tax credit designed to benefit low- to moderate-income workers with qualifying children. To claim the EITC, individuals must be U.S. citizens or resident aliens for the entire tax year. However, in certain cases, nonresident aliens who are married and filing jointly with a U.S. citizen spouse may also be eligible.

International students need to file Form 8843 with the IRS

Even if you have no income, you must still file Form 8843. If you have earned income in the US, you must file a tax return (Form 1040-NR) as well as Form 8843. The deadline for filing Form 8843 in 2025 was April 15, 2025. If you had no US income and were only filing Form 8843, the deadline was June 15, 2025.

To fill out the form, you will need to provide your name as it appears on your passport, and your addresses. If you have a Social Security Number (SSN) or Individual Tax Identification Number (ITIN), you can write it in the top right box. However, you do not need an SSN or ITIN if you are only filing Form 8843.

It is important to file Form 8843 correctly and on time. If you do not, you may encounter complications when applying for US visas in the future.

International students can be considered 'resident aliens' for tax purposes

International students on F-1, J-1, or M-1 nonimmigrant visas are generally considered nonresident aliens for tax purposes. However, they can become resident aliens for tax purposes if they meet certain criteria.

Firstly, if an international student has been in the United States for more than five calendar years, they may become a resident alien for tax purposes. This is because they will then meet the "Substantial Presence Test", which is one of the criteria for being classified as a resident alien. The Substantial Presence Test requires an individual to be physically present in the US for at least 183 days over a period of three years, including the current year and the two years prior.

Secondly, J-1 visa holders who are researchers or professors are considered resident aliens after two calendar years in the US.

Thirdly, international students can be considered resident aliens for tax purposes if they earn income from US sources and their country of residence has not signed a tax treaty with the US. This is because the US has income tax treaties with 65 countries, and these treaties often reduce or eliminate US taxes on various types of income for nonresident aliens.

It is important to note that being classified as a resident alien for tax purposes does not change an international student's immigration status. It only affects their tax filing status and liability for certain taxes, such as Social Security and Medicare taxes.

Frequently asked questions