Lana Oconnell
International students in the United States are required to file tax returns annually, and there are several forms that may need to be submitted. The specific forms and tax obligations depend on factors such as the student's visa status, income sources, and residency for tax purposes. Most students on F-1 visas are classified as nonresident aliens for tax purposes and are required to submit Form 8843 and may also need to file Form 1040-NR. International students with taxable scholarships or fellowships may need to submit additional forms, such as Form 1042-S and Form 1099. Properly filing tax returns is crucial for international students to maintain their legal status and avoid complications with future visa applications.
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What You'll Learn
F-1 visa and nonresident alien status
International students on an F-1 visa are considered nonresident aliens for tax purposes in the US for the first five calendar years of their stay. This classification is important for tax filing purposes. As a nonresident alien, you will be taxed only on income earned in the US, and you will be taxed at graduated rates based on the Form W-4 submitted.
The F-1 visa is a non-immigrant visa for those wishing to study in the US. It is the most popular visa choice for foreign students in America. F-1 students are exempt from FICA taxes on wages paid to them for services performed in the US for the first five calendar years of their stay. This exemption from social security and Medicare taxes is granted by the Internal Revenue Code.
As an international student on an F-1 visa, you will need to file Form 1040-NR (federal tax return) to assess your federal income and taxes. This form must be filed even if you did not earn any money during your time in the US. In this case, you will file Form 8843 with the IRS by the deadline, which is usually April 15, 2025. If you earned an income, you will likely also need to file Form 1040NR to complete your tax return.
Additionally, you may be required to file a state tax return and pay state income tax, depending on the state you are in. Nine states do not have any tax-filing requirements. It is important to note that tax rates and deductions will differ for each state, so the amount of tax you pay will depend on your location.
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State and federal income tax
International students in the US on an F-1 visa are considered nonresident aliens for tax purposes. This means that they are taxed only on income earned in the US, and are exempt from social security and Medicare taxes. The amount of tax they will pay depends on their income, the tax rates of each state, and their entitlement to tax treaty benefits. The US has income tax treaties with 65 countries, which can often reduce or eliminate US tax on various types of income.
Federal income tax is levied by the IRS on the annual earnings of individuals, corporations, trusts, and other legal entities. It applies to all forms of a taxpayer's income, such as employment earnings. Most states in the US collect state income tax in addition to federal income tax, and tax rates and deductions differ for each state. Therefore, international students may have to file a state tax return and pay state income tax even when no federal return is due. Nine states do not have any tax-filing requirements.
All international students are required to file a return with the IRS each year they are in the US. They must file federal and state tax returns if they earned income, and a non-employed federal form if they did not. If they did not earn an income, they must file the Non-Employed 8843 Form, which is available through Sprintax software. This form is due by April 15, 2025. If students earned an income, they must file Form 1040-NR (federal tax return) to assess their federal income and taxes. They may also need to file Form 8843, and they will need to enter their name, current address, and social security number or individual taxpayer identification number, as well as other general personal information.
Some students and scholars must also file a state income tax return, depending on the state. For example, students at Yale University may need to file a CT state income tax return, and students at the University of Southern Indiana may need to file an Indiana state tax return.
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Tax forms: 1040-NR, 8843, W-4, 1042-S, 1099
International students on F-1 visas are considered nonresident aliens for tax purposes and must file a US tax return if they earned income from US sources during the previous calendar year. Even if no income was earned, international students are still required to file a tax return.
Form 1040-NR
Form 1040-NR, or the US Nonresident Alien Income Tax Return Form, is used to report income earned from US sources, such as wages, tips, scholarships, and fellowship grants. This form is typically required for international students with income subject to tax. It is important to note that F-1 students are generally considered nonresident aliens, and their federal income is taxed accordingly.
Form 8843
Form 8843, also known as the Statement of Nonresidence, must be filed by all international students, regardless of whether they had income or not. This form is used to establish non-resident status for tax purposes and is a requirement for all international students, even those with no income. The deadline for filing Form 8843 is April 15, 2025.
Form W-4
Form W-4, or the Employee's Withholding Certificate, is completed by employees so that employers can withhold the correct amount of tax from their wages. International students who start working in the US must fill out this form and provide it to their employer.
Form 1042-S
Form 1042-S is used to report scholarship, fellowship, or grant income that exceeds tuition and related fee charges. It also documents income that is exempt from tax withholding due to a tax treaty. Educational institutions are required to issue this form to eligible students and scholars.
Form 1099
Form 1099 is used to document miscellaneous income, such as income earned as an independent contractor rather than an employee. This form may be received instead of Form W-2 and is used to report earnings from sources other than traditional employment.
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Tax treaties and exemptions
International students with F-1 visas are typically considered nonresident aliens for tax purposes for the first five calendar years of their stay in the US. This means they will only be taxed on US-sourced income. If an international student's country of residence has signed a tax treaty with the US, they may be partially or completely exempt from tax. The US has income tax treaties with 65 countries. These treaties can often reduce or eliminate US tax on various types of income, such as pensions, interest, dividends, royalties, and capital gains.
International students can benefit from a tax treaty with their home country. Under these treaties, residents of foreign countries may be eligible for reduced or exempt US taxes. For example, a special rule applies to students and business apprentices who are eligible for the benefits of Article 21(2) of the United States–India Income Tax Treaty. They can claim the standard deduction provided they do not claim itemized deductions.
International students who are nonresident aliens for tax purposes may be exempt from paying FICA taxes on their wages for services performed in the US. This exemption is granted by the Internal Revenue Code and is valid for five years from the date of their arrival in the US. To claim a refund for overpaid FICA taxes, international students can refer to the relevant guide.
To claim a tax treaty exemption, international students can submit Form 8233 to each withholding agent from whom they receive income. This form can be used to claim an exemption from withholding on income that is exempt from US tax under a tax treaty. Students must attach the appropriate statement from Appendix A of Publication 519, the US Tax Guide for Aliens, to Form 8233 and provide it to the withholding agent. If the tax treaty is not listed in the appendix, a statement in a similar format should be attached. It is important to note that failing to report treaty benefits can result in a penalty of $1,000 for each instance.
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Tax software and online resources
The process of filing tax returns can be challenging for international students, and tax software can be a useful tool to navigate the complexities of US tax filing.
Sprintax is a popular online tax software specifically designed for non-residents, including international students and scholars. It is user-friendly and offers comprehensive support with a team of knowledgeable staff who are quick to answer any queries. Sprintax is the non-resident partner of TurboTax, and it enables users to prepare a fully compliant 1040NR (non-resident tax return) and Form 8843 tax documents. It also assists in claiming tax refunds.
Another tax software option for non-residents is GLACIER Tax Prep, which offers various resources such as FAQs, tutorial videos, virtual sessions with tax professionals, and email support.
In addition to tax software, there are online resources available to help international students understand their tax obligations. For example, the Internal Revenue Service (IRS) website provides information on tax requirements for foreign students, scholars, teachers, researchers, and exchange visitors. It covers topics such as income tax treaties, Social Security, Medicare, and withholding taxes for non-resident aliens.
Furthermore, universities often provide resources and support for international students regarding tax filing. For instance, the University of Michigan offers discounted access to Sprintax and information on other tax preparation software and websites.
By utilising tax software and online resources, international students can ensure they accurately complete their tax returns, which is crucial for maintaining their visa status and future applications.
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Frequently asked questions
Yes, every international student is required to file their tax returns if they were in the US during the previous calendar year.
Even if you didn't earn any money, you will still need to file Form 8843 with the IRS.
If you received wages or taxable scholarships from US sources, you must file Form 8843 and 1040NR by the deadline.
Form 1042-S shows scholarship or fellowship funds exceeding tuition and related fee charges. You will receive this form around mid-February.
The purpose of filing tax returns is to report all sources of income to the government and ensure the correct amount of taxes was withheld.
