Douglas Olsen
International students in the US are required to file taxes each year, regardless of whether they earned an income or not. This can be a daunting process, especially for those who are new to the country. H&R Block offers a range of services to assist international students and expats with their taxes, including help with the substantial presence test, ITIN applications, state taxes, and tax deductions. They also provide virtual expat tax preparation services and have international tax experts who can help nonresident aliens file their tax returns using Form 1040-NR. Additionally, H&R Block offers a resource center for student tax filing, covering topics such as tax benefits, financial aid taxes, and more.
| Characteristics | Values |
|---|---|
| International students with complex residency situations | Refer to the Tax Residency Status Examples provided by the Internal Revenue Service |
| International students with no income | Fill out IRS Form 8843 |
| International students with scholarships, grants, wages/compensation, salaries, or tips | Fill out IRS Form 1040-NR, U.S. Nonresident Alien Income Tax Return |
| International students who are considered non-resident aliens for tax purposes | May use H&R Block Expat Services |
| International students who are considered resident aliens for tax purposes | May use H&R Block |
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What You'll Learn
International students with complex residency situations
If Sprintax determines that a student is a resident for tax purposes, they will be directed to TurboTax. As a resident, a student may use most online tax preparation providers, such as TurboTax or H&R Block. However, it is not recommended that non-resident aliens use H&R Block, as they may not be able to give accurate advice on how to file a Non-Resident Alien tax report.
International students on an F-1/J-1 visa are considered nonresident aliens for tax purposes and must file taxes each year they are in the U.S., regardless of whether they earned income or not. They will need to fill out IRS Form 8843 if they did not earn an income, and Form 1040-NR if they received scholarships, grants, wages/compensation, salaries, or tips. They may also need to fill out Form 8316.
Additionally, international students may need to apply for an IRS Individual Taxpayer Identification Number (ITIN) using Form W-7. This is a 9-digit number issued by the IRS to individuals who are required for U.S. federal tax purposes to have a U.S. taxpayer identification number but are not eligible to get a social security number (SSN).
It is important to note that the tax filing process can be complex, and students should seek guidance from a certified accountant who specializes in non-resident taxes or from their academic institution's international office.
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Non-resident alien status
International students on an F-1/J-1 visa must file taxes annually while in the U.S., regardless of whether they earned an income or not. Students with no income should fill out IRS Form 8843, while those with scholarships, grants, wages/compensation, salaries, or tips must fill out the IRS Form 1040-NR, U.S. Nonresident Alien Income Tax Return.
A non-resident alien is an individual who is not a U.S. citizen or national and has not passed the green card test or the substantial presence test. The substantial presence test determines an individual's tax residency status. It takes into account the number of days spent in the U.S. in the current year and the two years prior, as well as the type of visa held. Certain visa categories, such as teachers or trainees with a "J" visa, are exempt from counting days of presence for a specified period, typically the first two years on that visa. During this time, they are considered nonresident aliens and file a 1040NR.
If you are a non-resident alien at the end of the tax year, and your spouse is a resident alien, they can choose to treat you as a U.S. resident alien for tax purposes by filing Form 1040 with the status of "Married Filing Jointly."
As an international student, you may also need to file foreign informational returns such as FBAR and Form 8938. Additionally, you may be required to pay state and local taxes, depending on the state.
H&R Block provides expat tax services to assist non-citizens with their U.S. tax returns and FBARs. They can help with the ITIN application process and provide guidance on tax deductions and dependent claims.
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Resident alien status
H&R Block provides tax services for non-citizens and expats. The company's website provides information on the different visa statuses and their implications for tax filing.
Now, onto resident alien status:
A resident alien is a foreign-born, non-American citizen who resides in the United States. They are also known as a permanent resident or a lawful permanent resident. Resident aliens are considered immigrants who have been lawfully recorded as residents of the country. They are distinct from non-resident aliens, who are also non-citizens but do not reside in the US.
To be classified as a resident alien, an individual must meet either the green card test or the substantial presence test for the calendar year from January 1 through December 31. The green card test requires an individual to have a current or previous green card. The substantial presence test takes into account the number of days spent in the US: an individual who has spent 31 days in the US during the current year and 183 days over a three-year period, including the current year and the two preceding years, will be considered a resident alien.
There are certain exemptions to the substantial presence test, including time spent in transit (less than 24 hours), medical treatment, and individuals with specific visa types such as students, teachers, scholars, and exchange program visitors (on an F, J, M, or Q visa) who meet certain time requirements.
Resident aliens are subject to similar taxes as US citizens, including reporting their worldwide income and filing a US tax return each year they meet the applicable filing threshold. However, resident alien status often results in lower US taxes than non-resident alien status due to increased allowable deductions and lower tax rates for certain taxpayers.
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Obtaining an identifying number
As an international student, you may need an identifying number, such as an Individual Taxpayer Identification Number (ITIN) or a Social Security Number (SSN), to file your taxes in the United States. Here is some information on obtaining these numbers:
Individual Taxpayer Identification Number (ITIN)
If you are an international student without a Social Security Number (SSN) and need to file a tax return, you can apply for an ITIN. The ITIN is a 9-digit number issued by the U.S. Internal Revenue Service (IRS) to individuals who are required to pay taxes but are not eligible for an SSN. To apply for an ITIN, you need to complete Form W-7, which can also be used to renew an existing ITIN. Sprintax, a tax preparation software, will automatically generate a W-7 form for students with a tax liability and no SSN.
Social Security Number (SSN)
If you are an international student with income from a job or scholarship, you may be eligible for an SSN. To apply for an SSN, you will need to gather certain documents, such as proof of your immigration status, passport, visa, and I-94 record. You will then need to complete Form SS-5, which is the application for an SSN. After completing the form, you will need to schedule an appointment at your local Social Security office to submit the application and required documents in person.
Non-Resident Alien status
If you are an international student on an F-1/J-1 visa, you are typically considered a non-resident alien for tax purposes. As a non-resident alien, you will generally need to file a tax return even if you have no income. You will use Form 1040-NR, U.S. Nonresident Alien Income Tax Return, to report any income earned in the U.S. Additionally, you may need to file foreign informational returns such as FBAR and Form 8938. It is important to note that your visa status can impact your tax filing requirements, and certain visa categories must be treated as nonresident aliens for specific periods.
Tax preparation services
Several tax preparation services are available to assist international students with their tax filings. Sprintax is a commonly used platform that helps international students prepare and file their federal and state tax returns. H&R Block also offers Expat Tax Services, which can assist with the ITIN application process and provide guidance on state taxes and tax deductions. However, some sources suggest that H&R Block may not provide accurate advice for non-resident alien tax filings, and recommend seeking advice from a certified accountant who specializes in non-resident taxes.
In summary, as an international student, you may need to obtain an ITIN or an SSN to file your taxes in the United States. The process for obtaining these identifying numbers involves completing the necessary forms and providing required documentation to the relevant authorities. It is important to carefully navigate your tax filing requirements based on your specific circumstances, and seeking professional guidance can be beneficial.
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The substantial presence test
To meet the substantial presence test, an individual must be physically present in the US for at least 183 days over a three-year period, including the current calendar year and the two preceding years. The calculation is done by counting all the days spent in the US in the current year, one-third of the days spent in the US in the previous year, and one-sixth of the days from the year before that. For example, if an individual was present in the US for 120 days in 2021, 2022, and 2023, the total number of days for the substantial presence test would be 180 days (120 days in 2023 + 40 days in 2022 (1/3 of 120) + 20 days in 2021 (1/6 of 120)). Since the total is less than 183 days, the individual would not be considered a resident under the substantial presence test for 2023.
It is important to note that certain days are excluded from the substantial presence test calculation. Days spent in the US while commuting to work from Canada or Mexico and days spent in transit in the US for less than 24 hours do not count towards the 183-day threshold. Additionally, there are specific exemptions for individuals on certain visa types, such as teachers or trainees on "J" or "Q" visas, who do not count days present in the US for the first two years on that visa.
International students on F-1/J-1 visas are typically considered non-resident aliens during their first five calendar years in the US and are required to file taxes annually, regardless of their income. They may use Form 1040-NR or Form 8843, depending on whether they have earned income or not. After five years, F-1/J-1 visa holders are considered resident aliens for tax purposes and may be subject to different filing requirements.
While the substantial presence test helps determine tax residency status, it is just one factor in the overall determination of an individual's tax status. Other factors, such as visa type, income sources, and exemptions, also play a role in the final determination.
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Frequently asked questions
Yes, international students can use H&R Block to file their taxes. H&R Block has international tax experts who can assist nonresident aliens with their tax filings, including Form 1040-NR and other tax forms.
A nonresident alien, for tax purposes, is any foreign individual who is not a U.S. citizen or a resident alien of the U.S. You are considered a nonresident alien if you have not passed the green card test or the substantial presence test.
The first step is to determine your tax residency status by taking the Substantial Presence Test or the Residency Test. Then, gather the required documentation and work through the tax forms applicable to your situation, such as Form 1040-NR for nonresident aliens.
H&R Block can help international students understand what adjustments and deductions they may qualify for. Their Expat Tax Services provide guidance on tax deductions and how to claim them.
Yes, H&R Block offers a range of resources for students, including a tax resource center with information on tax filing, benefits, and financial aid taxes. They also provide guidance on claiming dependents and understanding the tax implications of financial aid.
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