Lori Meadows
International students on F-1 visas in the United States can apply for Optional Practical Training (OPT) to work in their field of study for up to 12 months after each level of education. STEM students can extend this period to 24 months. OPT participants are required to pay federal and state income taxes on their earnings, and they must complete tax forms with the Internal Revenue Service (IRS) and possibly with the New York State tax department. While most F-1 students are considered nonresident aliens and are exempt from Social Security and Medicare taxes, they may become residents for tax purposes and need to complete a W-9 form.
| Characteristics | Values |
|---|---|
| OPT full form | Optional Practical Training |
| Who can apply for OPT | International students under an F-1 visa |
| OPT work duration | 12 months |
| OPT work extension | STEM students can extend up to 24 months |
| OPT work type | Work directly related to the student's major field of study |
| OPT work timing | During university semester or after graduation |
| OPT work hours | Part-time or full-time |
| OPT tax | Federal and State income taxes |
| OPT tax form | W-4 |
| OPT tax deadline | 15 April |
| OPT tax percentage | Graduated rates from 10% to 37% depending on income level |
| OPT tax exemption | Social Security and Medicare taxes |
| OPT tax resources | Sprintax, NYU OGS, Beta Alpha Psi |
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What You'll Learn
- OPT participants may become a resident for tax purposes
- OPT students are taxed on their wages at graduated rates from 10% to 37%
- International students on OPT must fill in a W-4 tax form with their new employer
- F-1 visa students on OPT are exempt from FICA (Social Security and Medicare) taxes
- OPT students must file tax forms with the New York State tax department
OPT participants may become a resident for tax purposes
OPT or Optional Practical Training is a 12-month work authorization available to F-1 international students who have been full-time students for at least two consecutive semesters and plan to seek employment in the United States in their major field of study. After this, STEM students can extend this period up to 24 months.
OPT participants are usually considered nonresident aliens for tax purposes for the first five calendar years they remain in the US. However, OPT participants may become residents for tax purposes if they have been in the US for more than five years. In this case, they will need to complete a W-9 form (Request for Taxpayer Identification Number and Certification) and provide it to their employer.
To be considered a nonresident alien for tax purposes after five years in the US, OPT participants will have to prove to the IRS that they have kept a closer connection to their home country than the US and that they have not taken any steps to adjust their status to become a lawful permanent resident.
It is important to determine your residency status as an OPT participant so that you can claim any reliefs applicable to your country. For instance, depending on their personal circumstances, F-1 students on OPT may claim a tax treaty that can partially reduce or fully exempt their income from paying taxes.
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OPT students are taxed on their wages at graduated rates from 10% to 37%
Optional Practical Training (OPT) is an opportunity for international students under an F-1 visa to work in the US for 12 months. After this, STEM students can extend this period up to 24 months. OPT students are taxed on their wages at graduated rates from 10% to 37%. This depends on their income level.
International students on F-1 visas are considered nonresident aliens for tax purposes and must pay taxes on the following types of income: any income from US sources, taxable scholarships or fellowship grants, and any other income that is taxable under the Internal Revenue Code. The tax percentage withheld on scholarships and grants for F-1 and J-1 visa holders is 14%.
Most states in the US will collect state income tax in addition to federal income tax. Tax rates and deductions will differ for each state in the US, so the amount of tax paid will depend on where the student resides. Nine states do not have any tax-filing requirements. Students may have to file a state tax return and pay state income tax even when no federal return is due.
It is important to note that international students must complete a W-4 tax form with their new employer when they start work. Additionally, sometimes an OPT participant may become a resident for tax purposes. In this case, they will need to complete a W-9 form and provide it to their employer.
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International students on OPT must fill in a W-4 tax form with their new employer
OPT, or Optional Practical Training, is a program that allows international students under an F-1 visa to work in the US for 12 months after graduation, gaining practical experience in their major field of study. After this, students in STEM (Science, Technology, Engineering and Mathematics) can extend this period up to 24 months.
As an international student on OPT, you are considered a nonresident alien for tax purposes in the US, and are taxed only on US-source income. This means that you will be taxed on your wages at graduated rates from 10% to 37%, depending on your income level. You may also have to pay state tax on your income, depending on the state in which you live and your personal circumstances.
The W-4 form, or Employee's Withholding Allowance Certificate, is an Internal Revenue Service (IRS) tax form that you must fill out when you start working in the US, so that your employer understands your tax profile. The form helps to determine how much should be withheld from each payslip you receive through federal taxes and sent to the IRS. You will be asked to fill out some personal details, including your name, US address, TIN (Tax Identification Number), and marital status. It is important to complete the W-4 form correctly, as you may otherwise end up not paying enough taxes and will be struck with a large balancing payment at the end of the year.
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F-1 visa students on OPT are exempt from FICA (Social Security and Medicare) taxes
F-1 visa students on OPT are exempt from paying FICA (Social Security and Medicare) taxes. This is because F-1 visa students are considered nonresident aliens for tax purposes and are therefore exempt from paying Social Security and Medicare taxes. However, this exemption only applies if the student has been in the United States for less than 5 years. If an F-1 visa student has been in the US for more than 5 years, they are typically considered a resident alien for tax purposes and are then liable for Social Security and Medicare taxes.
It is important to note that while F-1 visa students on OPT are exempt from FICA taxes, they are still required to pay federal and state income taxes on any income earned while in the US. The federal income tax rate for nonresident alien students is typically between 10% and 37%, depending on their income level. Additionally, most states in the US collect state income tax in addition to federal income tax, and tax rates and deductions can vary by state.
To ensure compliance with tax requirements, F-1 visa students on OPT should be aware of their tax obligations and understand their residency status for tax purposes. They may also need to complete a W-4 tax form with their employer and file their tax returns by the deadline to avoid issues with future visa applications and potential fines or penalties.
In some cases, F-1 visa students on OPT may be able to claim tax treaty benefits that can partially reduce or fully exempt their income from taxation. However, it is important to note that tax treaties and their benefits can vary depending on the student's country of origin and specific circumstances.
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OPT students must file tax forms with the New York State tax department
OPT or Optional Practical Training is an opportunity for international students under an F-1 visa to work in the US for 12 months. After this, STEM students can extend this period up to 24 months. OPT is a form of employment that is directly related to your major field of study.
If you earn an income while in the US for OPT, you are required to pay your Federal and State income taxes. This means that OPT students must file tax forms with the New York State tax department. This is in addition to filing tax forms with the United States tax department (Internal Revenue Service).
International students on F-1 visas, who are considered nonresident aliens for tax purposes, must pay tax in the US on income earned in the US. Students with F-1 visas may apply for 12 months of OPT after each level of education is completed. If you earn an income from an OPT, you will be required to pay tax.
As an F-1 visa holder, you are exempt from FICA (Social Security and Medicare) taxes unless you've been in the US for more than five years. However, you will need to complete a W-4 tax form with your new employer when you start a new job. Additionally, if you become a resident for tax purposes, you will need to complete a W-9 form and provide it to your employer.
It is important to note that the US has tax treaties with certain countries, and their citizens may be exempt from all or part of US income tax. You can check IRS Publication 901, US Tax Treaties to see if your country has a tax treaty with the US and understand how it affects your tax status.
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Frequently asked questions
OPT stands for Optional Practical Training and is a 12-month work authorization for international students under an F-1 visa to work in the US in their major field of study. STEM students can extend this period to 24 months.
Yes, international students on OPT in New York are required to pay Federal and State income taxes on their US-source income.
International students on OPT in New York need to fill out a W-4 tax form with their employer when they start a new job. They may also need to fill out a W-9 form if they become a resident for tax purposes. At the end of the tax year, they will need to file their tax return.
The US tax deadline for 2025 is 15 April.
