Lori Meadows
International students in California have specific tax requirements that they must adhere to. Most international students are considered nonresidents for tax purposes, and they are generally taxed only on US-sourced income. F-1 visa holders, for example, are considered nonresident aliens by the IRS for the first five calendar years of their stay in the US. To understand the tax requirements for international students in California, it is important to know the various tax forms, such as Form 8843, Form 1040NR, and Form 540NR, and the income thresholds that trigger filing obligations.
| Characteristics | Values |
|---|---|
| Who needs to file taxes? | F-1 visa holders, F-1 students, J-1 students, F-2 visa holders, J-2 visa holders |
| Tax forms | Form 8843, Form 1040NR, Form 540NR, Form 1040, Form 1040X |
| Tax residency | Nonresident aliens, residents, part-year residents |
| Tax exemptions | Social security, Medicare, FICA tax |
| Tax refunds | Social security, Medicare, FICA tax, scholarships |
| Tax credits | Other State Tax Credit, deductions |
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What You'll Learn
F-1 visa requirements
International students on an F-1 visa are considered nonresident aliens for tax purposes for the first five calendar years of their stay in the US. They have special filing requirements when filing for US federal income tax returns and California state returns.
- Students must be enrolled in an "academic" educational program, a language-training program, or a vocational program.
- The school must be approved by the Student and Exchange Visitors Program, Immigration & Customs Enforcement.
- The school must be authorised by the US government to accept foreign students.
- Students must complete at least one full academic year at an SEVP-certified school to be eligible for annual vacation.
- Students must intend to register for classes in the academic term following their annual vacation.
- Students may not work off-campus during the first academic year but may accept on-campus employment.
- After the first academic year, students may engage in three types of off-campus employment: Curricular Practical Training (CPT), Optional Practical Training (OPT), and Science, Technology, Engineering, and Mathematics (STEM) OPT Extension.
- All off-campus employment must be related to the student's area of study and must be authorised by the Designated School Official (DSO) and USCIS.
- Students must maintain their F-1 status by fulfilling the purpose for which the visa was issued and following associated regulations.
- Students must enter the US no more than 30 days before their program of study begins.
- Students have 60 days after completing their program to leave the US or take action to maintain legal status, such as transferring to another school or changing their visa status.
- Students must complete the Nonimmigrant Visa Application, Form DS-160, and schedule a visa interview at a US Embassy or Consulate.
- Students will need a passport-style photo that meets the Photograph Requirements and may need to pay an application fee.
- Students will need a Certificate of Eligibility for Nonimmigrant (F-1) Student Status (Form I-20), issued by their school and signed by both the student and a school official.
- Students must be registered in the Student and Exchange Visitor System (SEVIS).
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Non-resident tax forms
International students in the US on an F-1 visa are generally considered nonresident aliens for tax purposes for the first five calendar years of their stay. As a nonresident alien, you will need to file Form 1040-NR (federal tax return) to assess your federal income and taxes. Even if you did not earn any income during your time as an F-1 student in the US, you are still required to file Form 8843 with the IRS by the deadline. This form is not an income tax form, but it is required by the IRS for tax purposes. Form 8843 is a "Statement for Exempt Individuals" that exempts international students from being treated as residents for tax purposes.
If you earned income in 2024, you may also need to file a federal or state tax return, or both, in addition to Form 8843. If you are considered a nonresident for tax purposes, you will likely use Form 1040NR to file taxes. If you are considered a resident for tax purposes, you will use Form 1040 to file taxes.
In the state of California, nonresidents or part-year residents with a filing requirement must file Form 540NR to report their income. Nonresidents pay tax on their taxable income from California sources. This includes income from services physically performed in California or deferred or equity-based compensation. California does not require an annual tax report from those who made less than the minimum filing requirement or had no income at all.
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Tax residency status
International students in California, particularly those on F-1 visas, are generally considered nonresident aliens for tax purposes for the first five calendar years of their stay in the US. This means that they are only taxed on US-sourced income.
To be considered a resident for tax purposes, international students must pass the Substantial Presence Test. This test requires that the individual be present in the US for at least 183 days in a period of 3 years, including the current year and the 2 years prior.
If an international student is considered a nonresident alien, they will need to file Form 1040-NR (federal tax return) to report their US-sourced income and assess their federal income and taxes. Additionally, they must file Form 8843, which is a "Statement for Exempt Individuals" that exempts them from being treated as residents for tax purposes. This form must be filed even if the student did not earn any income during their stay in the US.
If an international student is considered a resident for tax purposes, they will need to file Form 1040 to report their worldwide income. They may also need to file a California state tax return using Form 540NR, depending on their specific circumstances.
It is important to note that tax residency status can be complex, and international students should consult official government sources or seek professional tax advice to ensure they are complying with all relevant laws and regulations.
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Tax refunds
International students in California, particularly those on F-1 visas, are considered nonresident aliens for tax purposes. This means that they are taxed only on US-source income. Even if they did not earn any money during their stay in the US, they are still required to file Form 8843 with the IRS. This form is a "Statement for Exempt Individuals", which exempts international students from being treated as residents for tax purposes. The deadline for submitting this form is usually April 15, but if you have no US income and are only filing Form 8843, the deadline is extended to June 15.
If you did earn an income during your time in California, you will likely need to file Form 1040-NR as well. If the amount of tax deducted from your payments is more than the tax shown on this form, you will be due a refund. You can also apply for a FICA tax refund if you have been in the US for less than 5 years, as F-1 students are exempt from paying this tax during this period.
Additionally, if your country of residence has signed a tax treaty with the US, you may be partially or completely exempt from paying taxes. In such cases, you may be able to claim a refund on your scholarship if it is covered by the treaty.
To navigate the complexities of US tax filing for nonresident aliens, international students can use online resources such as Sprintax, which can help determine if you are due a tax refund and ensure you claim the maximum legal refund.
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Tax software
If you are an international student in California, you may be able to file your taxes without expert assistance by using tax software. Tax software can help you prepare your tax returns and determine your tax residency status.
Sprintax
Sprintax is an online tax software specifically designed for international students. It supports federal and state tax filing for nonresident international students and scholars. It offers a discount on federal tax forms for students at certain institutions, such as the California College of the Arts (CCA). Sprintax also provides informational videos on YouTube and free educational tax webinars to help you understand your tax obligations as an international student.
GLACIER Tax Prep
GLACIER Tax Prep is a web-based tax-compliant software that assists non-resident international students, scholars, and their dependents in preparing their US federal income tax forms. It helps determine tax residency, withholding rates, and income tax treaty eligibility. However, GLACIER Tax Prep does not assist with filing state tax forms.
TurboTax
TurboTax is another option for tax software, but it is important to use caution when filing as an international student or non-resident. Be sure to file the correct forms for a non-resident, and consider consulting a tax professional if you have a complex financial situation.
IRS Free File Fillable Forms
The Internal Revenue Service (IRS) offers free fillable forms on their website, which can be used to prepare your tax return. However, this option may be more suitable for those who are comfortable navigating the tax system and understanding which forms apply to their situation.
Tax-Aid
Tax-Aid is a non-profit charity organization that provides free tax services to the San Francisco Bay Area community. They offer virtual and in-person assistance in multiple languages, which can be helpful for international students who may not be fluent in English.
It is important to note that tax laws can be complex, and it is always recommended to consult a Certified Public Accountant (CPA) or a Registered Tax Return Preparer if you have specific questions or a complex financial situation.
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Frequently asked questions
International students are generally considered nonresidents for tax purposes and are only taxed on US-sourced income. However, they may still need to file a California state tax return using Form 540NR.
Form 8843 is a "Statement for Exempt Individuals" that exempts international students from being treated as residents for tax purposes. All F-1 foreign students must file this form, and it is also required for J-1 students.
International students who earned income in California may need to file Form 1040NR (federal tax return) to assess their federal income and taxes. If taxes were withheld from income that is exempt from taxation, Form 843 can be used to claim a refund.
Yes, Sprintax offers an online tax software specifically designed for international students to identify and complete the necessary forms for their tax returns.
The deadline for F-1 students to file their tax documents is typically April 15th. If an international student is only filing Form 8843, the deadline is extended to June 15th.
