All posts by

  • I filed an incorrect tax return. What should I do now?

    Amending your tax return

    “Don’t worry if you made a mistake on your tax return or forgot to claim a tax credit or deduction. You can fix it by filing an amended return.” – The IRS

    The Internal Revenue Service (IRS) knows the tax code is complex, and that people make mistakes. A tax return can be considered ‘incorrect’ or ‘incomplete’ for a variety of different reasons. Simple things like forgetting to sign a form to big issues like misreporting income or incorrectly calculating a deduction can all effect the validity of a tax return. If you realize that you made an error on a tax return you already filed or you have come across new information (for example you received an additional W-2 or 1042-S), simply file an amended tax return to make a correction.

    It’s very important to note that you should not attempt to correct the situation by filing another original Form 1040NR return. That will confuse things further and may cause additional headaches for you. Instead file a Form 1040X, even if you filed your original return only a few days ago.

    Need a hand filing your amended tax return? Contact Sprintax today!

    Here are some key things you need to know in order to correctly amend your tax return:

    When to Amend a Tax Return That You Filed

    The first thing you should know is that not all errors require an amended tax return. You should amend your tax return if you need to:

    • Correct your filing status – for example, if your filed as single but actually got married on the last day of the tax year, you will need to amend your return by filing his taxes under the appropriate status – married filing jointly or married filing separately (note: non-residents can file only as married filing separately).

    Filing US tax return as a married couple

    • Correct your income and tax figures because you did not include all your payment documents when preparing your return. If you receive additional tax documents for the tax year, for example, a Form W-2 arrives in the mail after the tax deadline, you would need to file an amended tax return to report the additional income and tax.
    • You should also amend your return to claim all of the allowable tax deductions or tax credits that you did not claim when you filed your original return. In previous years there were a number of deductions that international students could use to reduce their overall tax liability. However, in November 2017, President Donald Trump introduced a GOP tax reform bill which brought widespread tax-related changes for most taxpayers.
    • Correct the number of dependents you claimed. An amended return will be needed if a taxpayer wants to claim additional dependents, or has claimed ineligible dependents and needs to adjust the exemptions amount. The general IRS rule states that a non-resident alien, whether single or married, may claim only one personal exemption, as long as they are not claimed as a dependent on any other US tax return (in which case their personal exemption was already used). There are some exceptions to the general rule which allow specific groups of taxpayers to claim dependent exemptions for their family members:
    • Residents of Canada or Mexico
    • Residents of the Republic of Korea
    • Residents of India

    Check out if you qualify to claim an additional exemption for your dependent here.

    If you realize that you need to make one or more of the corrections listed above use Form 1040X to amend the federal income tax return that you previously filed.

    Need a hand filing your amended tax return? Contact Sprintax today!

    When Not to Amend a Tax Return That You Filed

    In some cases, you don’t need to amend your tax return. The IRS usually corrects math errors when processing your original return. If you didn’t include a required form or schedule, you’ll receive a request for the missing item needed to finish processing your tax return. When you receive a notice about errors, there will usually be other ways to correct errors besides an amended tax return.

    Usually, these misunderstanding can be quickly rectified by providing the correct information to the IRS. The notice that you receive will explain clearly what the issue is and how to respond.

    filing a US tax return

    How to Amend a Tax Return That You Filed

    To amend your tax return you will need:

    • A form 1040X
    • Your original tax return
    • New documents

    The Form 1040X is two pages long and you are only required to include new or updated information. You will also find a space where you can write an explanation as to why you are amending your return.

    It’s very important to ensure you are using the latest version of the 1040X.

    Once you complete the form, you’ll have to mail it to the IRS along with all required supporting document. Amended returns are only filed on paper. The normal processing time for a Form 1040X, is between 8 and 12 weeks from the time the IRS receives your tax return.

    If you are amending for more than one tax year, you will need file Form 1040X for each tax year separately.

    Many people find the prospect of dealing with the IRS and amending their tax return to be quite daunting. If that sounds like you, contact Sprintax today!

    What Happens After You Amend Your Tax Return

    US tax refund

    If you are filing an amended tax return to claim an additional refund, you’ll have to wait until you have received your original tax refund before filing a Form 1040X. Amended returns take up to 12 weeks to process. You may cash your original refund check while waiting for the additional refund. Also you generally MUST file the amended return within three years from the date you filed your original return, or within two years after the date you paid the tax (whichever is later) in order to get the extra refund.

    If you owe additional taxes with Form 1040X, file it and pay the tax as soon as possible to minimize interest and penalties. If your amended return shows you owe more tax than you reported on (and paid with) your original return, you’ll owe additional interest and probably penalties too. Even though you might be amending a return from one or two years ago, the due date for your original return and for payment has already passed. The IRS may not penalize you for a small mistake, but it sure will collect some interest on the proper amount you didn’t pay on time in the first place. The sooner you correct the error, the less interest you’ll pay.

    Don’t hesitate to contact the Sprintax team if you need help with amending your return!

  • Everything you wanted to know about US tax (but were afraid to ask!)

    Us international students tax questions

    You might be surprised to learn that, at present, there are around one million international students studying in the United States. What won’t surprise you however, is that each of these one million students have tax obligations in the United States.

    What are these obligations? This is where things get a bit tricky!

    If you’re an international student in the US you might not be too familiar with the local tax system. And it’s highly likely that you’ll have some questions about your tax obligations and what you’re entitled to. That’s why we’ve created this handy guide to US tax for international students.

    So let’s get into it.

    Q – Who or what is the IRS?

    IRS for international students

    The Internal Revenue Service (IRS) is the US government agency responsible for the collection of taxes and the enforcement of tax laws. The agency dates all the way back to 1862 when it was introduced by the then President Abraham Lincoln. Its primary purpose includes the collection of individual income taxes and employment taxes. The IRS also handles corporate, gift, excise and estate taxes.

    Q – What can you tell me about the American tax system?

    Both Americans and foreign nationals residing in the US must pay taxes to both the State and Federal government. Usually, when an individual earns an income, a portion of it is automatically deducted and transferred directly to the government. Every January employers send summaries to their employees of how much income they were paid as well as how much of their income was sent to the IRS.

    Q – What income will I need to pay tax on in the US?

    US tax for international students

    As an international student in the US you will have to pay tax on the follow types of income:

    • Wages
    • Salaries
    • Tips
    • Interest
    • Dividends
    • Some scholarships/fellowship grants

    Q – How do I know if I made ‘US source income’?

    US source income is defined as wages from a job in the United States, received scholarship money from an American organization, or made interest on money in an American bank account etc.

    Q – What is an Income Tax Return?

    US tax returns for international students

    An income tax return is the form that individuals and business submit to the IRS in order to file their taxes.  ‘Form 1040 NR’ and ‘1040NR-EZ’ are all examples of income tax forms.

    The purpose of filing your tax return is so that you can report all sources of your income to the government – including the tax you have already paid and what you still owe. It’s also an opportunity to claim any deductions or exemptions that you may qualify for.

    At the end of the process, you calculate the total tax you should have paid. If you paid more than what you owe during the year, you will be reimbursed. On the other hand, if you didn’t pay enough, you have to pay the difference.

    Q – Am I required to file a tax return?

    Yes. Every international student inside the United States must file their tax return each year.

    Q – What is tax residency status?

    US residents have differing tax obligations depending on their relationship with the country. Each taxpayer must determine their own residency status before they file their tax return. The most common tax residency statuses are ‘resident’ and ‘non-resident aliens’.

    Q – How can I work out my residency status?

    Most international students who are studying in the US on F, J, M or Q visas are considered non-resident aliens for tax purposes.

    International students on F1 visas are automatically considered non-resident aliens for their first 5 calendar years in the US, and scholars (and their dependents) on J visas are automatically considered non-residents for their first 2 calendar years in the US.

    If you’ve been in the US for longer than the 5 or 2 calendar years, you will be considered a ‘resident alien’ for tax purposes if you pass either the ‘green card test’ or the ‘substantial presence test’ for the calendar year (January 1-December 31).

    Green Card Application Form. for international students

    Q – What is a substantial presence test?

    You will be considered a US resident for tax purposes if you pass the substantial presence test for the calendar year. To meet this test, you must be physically present in the US on at least:

    • 31 days during the current year and
    • 183 days during the 3-year period that includes the current year and the 2 years immediately before that, counting:
      – Every day you were present in the current year
      and
      – 1/3 of the days you were present in the first year before the current year
      and
      – 1/6 of the days you were present in the second year before the current year

    Case study

    Sam was present in the US for 120 days in each year from 2015-2017. To determine if he passes the substantial presence test for 2017 he can count his full presence in 2017, 40 days in 2016 (1/3 of 120 days), and 20 days in 2015 (1/6 of 120). Since the total for the 3-year period is 180 days, Sam will not be considered a resident under the substantial presence test for 2017.

    Days of Presence in the United States

    You are treated as present in the US on any day you are physically present in the country, at any time during the day. However, there are some exceptions to this rule. For example, you can’t count the following as days of presence in the US:

    • Days you commute to work in the US from a residence in Canada or Mexico, if you regularly commute from Canada or Mexico
    • Days you are in the US for less than 24 hours, when you are in transit between two places outside the United States
    • Days you are in the US as a crew member of a foreign vessel
    • Days you are unable to leave the US because of a medical condition that develops while you are in the US
    • Days you are an ‘exempt individual’ (more details below)

    Exempt Individual

    The term ‘exempt individual’ refers to anyone in the following categories:

    • An individual temporarily present in the US as a foreign government-related individual under an A or G visa (other than individuals holding A-3 or G-5 class visas)
    • A teacher or trainee temporarily present in the US under a J or Q visa, who substantially complies with the requirements of the visa
    • A student temporarily present in the US under an F, J, M, or Q visa, who substantially complies with the requirements of the visa
    • A professional athlete temporarily in the US to compete in a charitable sports event

    Q – What tax forms do I need to file?

    Form 8843 for international students

    Every international student, will need to file a Form 8843 (which essentially proves that you’re a non-resident) and if you have received income in the last calendar year then you will most likely need to file a Form 1040NR-EZ also.

    The 1040NR-EZ is used to declare your US source income and determine how much tax you owe on that income. It’s a simplified version of the 1040-NR and most international students can use it.

    Q – What information will I need in order to complete my tax return?

    This is an official government W-2 Form.

    The first thing you will need is your US taxpayer identification number (TIN). A US TIN for an individual is either a US Social Security Number (SSN) or an individual taxpayer identification number (ITIN). Only foreign nationals who are authorized to work in the United States under the US immigration law are eligible to apply for a SSN. Foreign nationals not eligible to apply for a SSN may submit a Form W-7 ITIN application to the IRS.

    Confused? Learn more here about ITIN.

    To prepare your tax return you will also need your income documents like W-2’s, 1042-S’s, and/or 1099’s, which will be mailed to you by the university and your employer.

    W-2 – This document, provided by your employer, includes details of the wages you earned and the taxes withheld from your wages. You should receive this document by January 31.

    1099 – This document is a report from your bank on the interest you have earned on your accounts. You should receive this by January 31.

    1042-S – This details wages paid to you if you already claimed a tax treaty benefit, and scholarship income that was used for expenses other than tuition and fees (such as room, board, or travel). You will receive this by March 15.

    Don’t forget – if you don’t have taxable US sourced income you won’t receive income documents and you won’t need to apply for a US TIN. In this case you’ll just need to submit Form 8843 to the IRS.

    Q – How do I submit a tax return?

    You can choose to fill out all of the paperwork and submit your tax return directly to the IRS yourself. Depending on the tax rules of the state in which you lived and /or worked you may also need to file a state return to your state tax office.

    Alternatively, many international students find the thought of submitting a tax return to be quite daunting. If you’d like a hand with the preparation of your return, you can enlist the help of a tax agent like Sprintax. Preparing your tax return is easy with Sprintax and we guarantee to keep you compliant with the US tax authorities.

    Q – How can Sprintax help me?

    Sprintax will take the stress out of filing your tax return by offering you step-by-step assistance throughout the entire process.

    Sprintax can also help you to determine if you are considered a ‘resident’ or ‘non-resident’ for tax purposes and guarantees to maximise your tax refund.

    • Online US tax prep solution for international students and scholars
    • US tax compliance guaranteed
    • Built-in knowledge of over 350 different types of tax deductions
    • 65 international tax treaty agreements and exemptions covered
    • Maximum legal tax refund for federal, state & medicare

    Just complete the registration form here to get started.

    Q – What is the deadline for filing a tax return?

    The filing deadline for US federal income tax returns for individuals is April 15. However, in the event that this date falls on a Saturday, Sunday or holiday, the first succeeding day that is not a Saturday, Sunday or holiday will be the deadline.

    Q – What should I do if I am unable to file my tax form by the deadline?

    Form 4868 for international students

    Need more time to complete your return? Simply file a 4868 to request an automatic deadline extension to August 15.

    It’s important to note that you will not be notified if your extension request is approved – the process is automatic.  If you owe any taxes, you must still mail the estimated tax payment by the April 15 deadline or you will have to pay penalties and interest on any payment owed.

    Q – Does it cost anything to file my tax return?

    If you decide to file your tax return yourself, the process is free.

    The Sprintax fee structure is as follows:

    Form 8843 – $15.95

    Form 1040-NR – $35.95

    ITIN Application – $15.95

    State Tax Forms – $25.95

    Q – Am I entitled to any tax exemptions?

    In previous years there were a number of exemptions and deductions that international students could use to reduce their overall tax liability.

    However, in November 2017, President Donald Trump introduced a GOP tax reform bill which brought widespread tax-related changes for most taxpayers.

    Check out our detailed article about the GOP Tax Reform and its effects on the taxation of foreign students and other non-resident aliens here.

    tax returns for international students

    Q – Will I be entitled to a tax refund?

    You may be entitled to a tax refund if you paid more than what you owed during the year.

    Once you’re tax return has been completely filled in you will be able to determine if the US government owes you a refund.

    Sprintax can help you to you to retrieve your maximum tax refund.

    Q – How can I claim my tax refund?

    You can claim your tax refund when you file your tax return.

    Alternatively, if you choose to file with Sprintax, you’ll be guaranteed to receive your maximum legal tax refund.

    tax refund for international students

    Q – Do I have to pay taxes on income I received from my home country?

    No. The US will not tax your income from non-American sources.

    Q – There is a tax treaty between the US and my country. Should I file a tax form?

    Yes. You will still be required to file a tax return for each year you spent studying in the US.

    Q – I’m an F-1/J-1 student with no US income or scholarships for 2017. Do I need to file anything?

    Yes. You are required to complete a Form 8843 with the IRS regardless of whether you received income.

    Q – I arrived in the US in December and I didn’t work. Do I still have to file Form 8843?

    Yes. Every non-resident alien who spends any portion of the year in the US on an F or J visa must complete a Form 8843 and send it to the IRS.

    Q – What happens if I don’t file a tax return?

    Payment of an income tax liability is required by law and complying with US tax law is one of the conditions of your visa. If you owe taxes and don’t file, the IRS can impose penalties and interest and there can also be consequences for future immigration.

    For instance, if you apply for permanent residency (a green card) it’s likely that you will be asked to provide evidence of your tax filing for previous years in the US.

    Filing a tax return is also the only way you can retrieve your tax refund. It would be a shame to leave money you’re entitled to behind!

    File your return with Sprintax today!

  • Phew! Tax season is finally over! But what should I do now?

    Here are the tax records you need to keep and how long you should keep them for

    When tax season ends it can feel like a big weight has been lifted off your shoulders – an opportunity to exhale and relax (until it all starts again next year that is!) But before you expel all tax topics completely from your mind, there is one final task you must complete.

    Carefully store all of your tax records!

    It’s very important that you organize and store all of your tax records and documentation – including a copy of your tax return.

    Here’s why:

    (1) Audits

    If you’re ever selected by the IRS for an audit you will need to have access to your tax returns and the documents you used to complete them. If the IRS does audit you, they’ll generally look back at your returns over the previous three years so you’ll want to have copies of the returns you filed for those years close at hand. You’ll also need your W2s, 1042-S’s, 1099s, receipts, or any paperwork that will support your tax deductions or credits that you may have claimed on those returns.

    sprintax

    (2) Amendments

    After you file your tax return, you may discover that you need to amend it due to an error or a tax break that you should have claimed. In such cases you will need a copy of the return you filed along with all documents (such as your W-2, 1042-S, 1099) and supporting information (like receipt and statements) you used to prepare the return.

    (3) Residency

    Good tax record keeping will also be useful if you decide to apply for permanent residency (a green card). During the application process you will need to provide evidence of continuous compliance with the US tax law by enclosing the tax return(s) you’ve filed.

    (4) Future returns

    Tax returns you have filed in previous years can help you in preparing future tax returns. For example, you may need to refer to previous figures like refund amounts, deductions, or tax due etc.

    sprintax washington

    How long should I keep tax records?

    According to the statute of limitations outlined by the IRS, the basic rule is that you should keep all of your relevant tax documents for at least 3 years after the date in which you filed. In other words, if you filed a return in 2017 you should keep all tax documents relating to it safe until 2020.

    In some cases, you may need to hang onto your records for longer than three years. For instance, you should plan on keeping tax forms for retirement accounts such as IRAs for seven years after the account is completely wiped out.

    Additionally, if you buy or sell property, you should keep property records until the statute of limitations expires for the year in which you dispose of the property.

    Our advice? Keep all your US tax records at least until 3 years after you have left the US!

    How to keep tax records?

    The law doesn’t require any special record-keeping system for all taxpayers. You can keep your records in any manner that works best for you. If you plan on keeping your records for a long time you should consider scanning your documents and keeping a backup of the files.

    sprintax time square

    Filing your return

    All international students and scholars in the US are required by law to file a tax return. Sprintax can help you to do exactly that. Our easy-to-use system removes all of the stress from the tax filing process. Plus we’ll even help you to retrieve your maximum legal tax refund!

    Not bad!

    Get started now!

  • What to do if you miss the tax deadline

    US TAX Deadline

    Step one: Don’t panic!

    Missed the April 17th deadline? Don’t panic! Nearly 30% of taxpayers are unable to organize their documents before the deadline. But you can still fix this! Here are a few important things you should consider if you missed the tax deadline.

    (1) If you are due a refund or your tax return shows no tax liability

    Tax refund

    If you’re entitled to a refund or your tax return shows no tax liability, you may not be fined for filing late. If you’re due a refund, you should file as soon as possible to get it. You may be entitled to a refund if you had too much tax withheld from your wages or you qualify for certain tax credits.

    Sprintax will help you determine if you are due a refund.

    It’s important to note that there is a time restriction on claiming a federal tax refund. So, if you don’t file within three years from the due date of your tax return (17th of April, 2018 for 2017 tax year), you may not receive your refund.

    In addition, there are some tax refund policy changes for late filing taxpayers that the IRS is implementing and these may affect how quickly you will receive your refund.

    (2) If you owe tax

    USA flag and American dollars. American flag blowing in the wind and 100 dollars banknotes in the background. USA flag and American dollars. American flag blowing in the wind and 100 dollars banknotes in the background

    If you have underpaid tax, keep in mind that both late filing and late payment penalties may be charged on top of your tax liability. The failure-to-file penalty is the bigger portion of your penalty, and after 60 days of delay its minimum amount will be $205. So if you have not filed form 4868 – Extension to file – you may need to submit your tax return to the IRS as soon as possible in order to avoid a further increase of your fine.

    Your failure-to-pay penalty will depend on the amount of tax you owe. The percentage of the penalty increases over time, so even if you are not ready with your documents, the more tax you pay on time (before the deadline) the less interest and penalty charges you will accrue.

    If you are unable to pay your tax on time, you can choose to enter into installment agreement with the IRS. There are certain conditions you will have to meet and Sprintax tax experts can help you if you choose to request an installment agreement from the IRS.

    Summary

    If you missed the deadline, the best thing you can do is to prepare your tax documents and file your tax return as soon as possible!

    Sprintax can help you to prepare your tax return and determine if you’re entitled to a refund.

     

  • I’m studying in the US. Can I stay in America after I finish my degree?

    It’s possible to stay in the US under certain circumstances. We take a closer look at two options – OPT and H-1B

    Most international students studying in the US have been granted entry into the country on an F-1 visa. This visa allows students to attend college, university, conservatory, high school, elementary school, and seminary or language school in the US. If you are studying in the US on an F-1 visa, once the study program is finished, you will have 60 days to depart the country, get a new visa or otherwise validate your stay in the country.

    If you would like to stay in the US after you have completed your program, the first possibility you should consider is the Optional Practice Training (OPT) program.

    Optional Practical Training (OPT)

    Intern. International student. Portrait Of An Office Worker

    OPT is a program that allows international students to work in the US after their graduation, and gain practical experience.  Students with F-1 visas may apply for 12 months of OPT after each level of education complete. For instance, after completing their bachelor education, students can apply for 12 months of OPT, and then for another 12 months after the completion of their master degree. Science, Technology, Engineering and Mathematics (STEM) graduates have the option to extend their program by 17 months (to total 29 months).

    While you participate in your OPT program, you do not need a new visa. OPT program participants are treated as F-1 status holders.

    H-1B Speciality Occupations

    Another option available to you is to change your visa status to H-1B by applying for an interim OPT phase before H-1B, or to apply for H-1B directly from F-1.

    H-1B Specialty Occupations is a non-immigrant visa that gives graduates temporary employment authorization in high-skilled occupations. H-1B applicants are required to have specialized knowledge and a bachelor’s degree or higher (or its equivalent). Most H-1B jobs are in industries such as science, engineering, and information technology. Under this visa you are allowed to work in the US for initial period of three years, and you may apply for an extension which, if your application is successful, will entitled you to a further three years in the US.

    Here are some useful tips on how to get started

    Start early

    Intern. International student. Woman's hand writing on a notebook with a pen on a wooden desk.

    Plan ahead and try to secure a job or an internship as soon as possible so you have time to prepare all of the required documents. You can even start looking before your graduation, and by doing this you can be sure that you have explored all available options.

    Choose your start day wisely

    You are allowed to choose your OPT start date. Keep in mind that with OPT status you can stay in the US for 90 days while unemployed, and the 12-month work period begins on the start date you choose on your application.

    Networking

    Building connections is also very important when you are looking for an internship or a job. You never know how the person you met yesterday can help you in finding the perfect job tomorrow. Therefore, go out, attend different events, and make connections that may turn out to be very effective.

    Attend career forums

    Career forums can be quite useful so give them a chance! You will get to meet people representing different companies and sectors, and you can be introduced to other people that can offer you exactly what you have been looking for.

  • Moving to the US to study? Here’s 10 things to expect

    From your daunting first day to excelling in the classroom – top tips to make the most of college life

    Are you planning a move to the US for study? You’re not alone.

    In fact, the US attracts 1,000,000 international students to its colleges and universities every year. And it’s very easy to see why.

    American universities are amongst the best in the world and offer truly high-class education opportunities to their students. Away from the campus, the US boasts a large mix of cultures which makes it a really interesting place to study and live.

    But moving to a new country is always a big deal for any international student. And it can be hard to know what to expect.

    With this in mind, here’s 10 things to expect when you arrive in the US to study.

    1 – You might freak out at first!

    Let’s face it. There’s a lot to do at first when you move to a new country.

    You’ve got to move into your accommodation and unpack. Next you have to familiarize yourself with the local area. And then you’ve got to get set up with supplies, college necessities, a new phone, a bank account ……..

    And then it hits you. ‘I’m an international student in America. And I’m a long way from home.’

    But don’t freak out! This is when the exciting stuff starts to happen. Go out and meet new people.

    It’s likely there’ll be lots of international students that are going through the same things you are. Talk to them. Pretty soon you’ll be feeling right at home in your new surroundings!

    2 – You can hit the ground running

    ‘Orientation Week’ or ‘Welcome Week’ can be a really useful time to help you get used to your new surroundings. During this week you’ll have a great opportunity to explore your new campus and find your bearings. You’ll also be properly introduced to your course, tutors, and peers.

    Make sure you use this time to sign up for lots of on-campus clubs and societies as these are a good way to meet people.

    3 – There are top-notch student support facilitates available on campus

    Studying in the US is no doubt a rewarding experience, but navigating your way through day-to-day issues can sometimes be tough. The aim of an international student office is to assist students, just like you, to adapt to their new environment.

    That’s why they offer a wide range of student services such as:

    • English-language practice courses
    • Orientations, and trainings
    • Financial aid
    • Career advice
    • On-campus psychiatry and counselling

    They can also help to answer any questions you may have regarding your visa status, housing, employment possibilities, health concerns and more.

    4 – You’ll find cutting-edge technology

    American universities pride themselves on being at the forefront of technology and research techniques.

    If you’re chosen discipline doesn’t directly involve science or engineering, don’t worry. You’ll still have tonnes of opportunity to become skilled in using the latest technology to conduct research, as well as obtain and process information.

    5 – Life in college is relaxed…. until the grading begins!

    Life on campus is usually pretty relaxed and flexible. In fact, it’s normal for US students to work classes into their own schedules.

    Most students are not obliged to show up at every single class, or even to stay for an entire lecture. But, just because you can avoid and skip classes, doesn’t mean you should!

    Remember, the importance of your grades and Grade Point Average (GPA – an average score based on the grades and results of every class you’ve taken during your studies) can’t be overstated.

    The key is to find the right balance between your studies and enjoying campus life.

    6 – You’ll acclimatize to the culture sooner than you think!

    If you like sports, you’re going to feel right at home in the US. Between all of the professional sports like basketball, American football, ice hockey, baseball and soccer, there is something on pretty much every night of the week!

    And Americans take their college sports pretty seriously too. In fact, some of the biggest stadiums in the world were built for US college teams.

    Rooting for your college team is a great way to feel part of the community. Not only will this help you to have conversations with native students, it will also provide you with an authentic experience of American culture.

    Away from the sports field, you’ll find no shortage of options to keep you entertained. America is at the cutting edge of the music, film and literary worlds. So it won’t take you too long to find something you like.

    If you like going out on the town, remember that the legal drinking age in the US is 21. And you’ll need a proper ID to get into most bars and clubs.

    7 – Opening a bank account may take some time

    You’ll find a US bank account to be very useful, especially if you plan to work part-time, pay bills or keep savings. Setting up a bank account can take some time, as there a number of steps to complete. So it’s a good idea to start this process soon after you arrive in the US.

    Here’s further information on how to set-up a US bank account and some more tips for international students in America.

    8 – You shouldn’t work too hard!

    You may be intending to search for employment in your spare time and earn some extra cash. But be careful, as not all types of employment are eligible under the conditions of an F-1 (student) visa.

    For instance, F-1 students who want to work off campus can only do so in roles that are related to their studies. Most of the other off campus roles are not authorized under F-1 and you will need permission by a DSO (Designated School Official) in special circumstances to do this work.

    F-1 students are entitled, however, to find employment on campus.

    But it’s important to note that while school is in regular session, a student can’t work for more than 20 hours per week. During extended holidays, breaks and summer sessions, you can work full time (up to 40 hours per week).  If you are confused whether a job is considered on-campus employment, ask the employer before you accept the role.

    9 – You’re going to have to file a tax return

    You may find this a bit strange if you are normally resident in a country where you don’t have a tax filing obligation.

    Yes, every international student is required to file a tax return (federal and state, if required) for each year present in the US, and pay tax if they earn income. In fact, it’s one of the terms of the student visa.

    And even if you don’t earn money during your time in the US, you will still need to file with the IRS by the April 17 deadline.

    Many international students find the prospect of filing a tax return to be quite daunting and this is completely understandable. Fortunately help is on hand!

    Sprintax can file your fully compliant Federal, State and FICA tax return. We can also help you to retrieve your maximum legal tax refund. And, if you’re confused about your US tax obligations, Sprintax can answer any questions you have. Get in contact with us today!

    We’ll take care of the complex tax requirements so all you have to do is enjoy your time studying in America!

    10 – You’ll have a blast

    You’re studying in the United States after all!

    Each day you will have opportunities, not only to broaden your knowledge in top academic institutions, but also to collect countless life experiences that will stay with you forever.

    Most universities offer a variety of student clubs and organizations to meet every interest. You’ll also have the chance to immerse yourself in American culture, meet new people and make new friends.

    What could be more exciting? Enjoy!

  • Here’s everything you need to know about the W-2 tax form

    Your questions answered!

    The tax filing deadline is on the horizon and quickly approaching! And most employees are now on the lookout for their W-2 tax form. But why is this little form so important?

    Here’s everything you need to know.

    What is a W-2 Form and why do I need it?

    The Internal Revenue Service (IRS) requires every employer that is engaged in a trade or business, and that pays remuneration for services performed by an employee, to file a Form W-2 for each employee.

    You will find the W-2 Form to be very useful when you are filing your end of year tax return. The form includes  important details regarding your total gross earnings including wages, tips and taxable fringe benefits, Social Security earnings, Medicare earnings, and the Federal and State tax that is withheld.

    How do I read a W-2?

    The information is divided into different sections on the form.

    For example, in Box 1 you will find information about your annual wage and salary payments, together with the amount of federal tax withheld from it in Box 2. Other boxes on the W-2 form such as 3, 4, 5 and 6 include your wages subject to Medicare tax, Social Security tax and the amount of these taxes withheld from your income. Boxes 15 to 20 provide information about each state you worked in, state income subject to tax in this state, and the amounts of state and local taxes withheld, if applicable.

    Important elements like your name, surname, address and SSN or ITIN (social security number or individual taxpayer identification number) as well as your employer’s EIN (employer’s identification number) are also included on the form.

    Note: While you read your W-2, always double check that the information is correct. If you find any errors, inform your employer immediately about the mistakes so they can amend them before you start your yearly tax return.

    When is the deadline?

    Your employer must provide you with your W-2 form by 31 January after the end of the tax year to which it relates (for example, you must receive your W-2 form by 31 January 2018 for the year ending on 31 December 2017).

    What if I still haven’t received my W-2?

    If this deadline has passed and you still have not received your W-2 form from your employer, you should contact them immediately to confirm that it was sent and that it was dispatched to the right address. Your employer may also provide your copy via a secure link online.

    Alternatively, you can contact the IRS or use Sprintax offline services provided by our team of tax professionals.

    Got all your income documents?

    Good for you!

    If you have received your W-2 Form, as well as any other required income documents (such as 1042-S or 1099’s) you can use Sprintax to prepare your tax returns online. Last year Sprintax assisted approximately 100,000 international students, scholars and non-resident professionals with their tax returns. What’s more, 90% of those that had a Federal filing requirement were also due a refund!

    Get started with Sprintax today and our live chat team will guide you through your tax return!

     

     

  • 5 ways to maintain a valid F-1 visa status

    Can I leave and return to the US on an F-1 visa?

    Am I entitled to work during the semester?

    How long can I stay in the country after my program is finished?

    All your F-1 visa questions answered!

     

    Dreaming of American college life?

    Getting your hands on an all-important F-1 visa is a big step towards turning that dream into a reality. But getting an F-1 visa is one thing, maintaining it is another.

    As a student, there are a number of important rules and regulations that you must follow in order to maintain your F-1 visa status. If you don’t do so, you will not be allowed to re-enter the US if you leave, and you won’t be eligible for practical training (OPT or CPT) or on-campus employment.

    So, with this in mind, here are our top 5 tips for maintaining a valid F-1 visa status

     

    (1) Arriving in the US

    Once you receive your F-1 status, you’ll without a doubt be eager to hit the ground running with your studies.

    But don’t be too eager!

    One of the requirements of the F-1 visa is that you don’t arrive in the US more than 30 days before the first day of classes.

    You’ll also need to link in with your institution’s international office within 30 days of your arrival. Be sure to provide them with your local address in order to keep your SEVIS (Student and Exchange Visitor Information System) record up-to-date. And if you change your local address at any time while in the US, you will need to notify them of this.

    Once you have completed your program, you will have 60 days to leave the US.

    But what if you want to stay extend your American college dream?! To stay in the US you will need to pursue one of the following options:

    • Re-enrol in a higher program
    • Transfer to another school to receive a new Form I-20 (Certificate of Eligibility for Non-immigrant Student Status)
    • Apply to change your visa status

     

    (2) Attendance and grades

    All F-1 visa holders are required to be enrolled full time, go to class and maintain passing grades.

    Students who are having difficulty in classes, should notify their international advisor. And if it’s not possible to complete your program by the date stated on your Form I-20, your international advisor can help you request an extension.

    Full-time enrolment can differ depending on your student status. For example, undergraduate programs require students to enrol in at least 12 credit hours each semester during the academic year.

    Meanwhile, each graduate program defines their own unique combination of credit hours and research time to be considered ‘full-time enrolment’. To uphold your F-1 visa status, it’s best to confirm the enrolment requirements with your college.

     

    (3) Working

    It’s common for students to seek full or part-time employment while they study in the US. But be careful, not all types of employment are eligible under the conditions of an F-1 visa.

    For instance, F-1 students who want to work off campus can only do so in roles that are related to their studies (more on this below). Most of the other off campus roles are not authorised under F-1 and you will need permission by a DSO (Designated School Official) in special circumstances to do this work.

    It’s important to note that, if you choose to work without the proper authorization, your visa can be revoked and you may have to leave the US.

    F-1 students are entitled to find employment on campus.

    However, while school is in regular session, a student can’t work for more than 20 hours per week. During extended holidays, breaks and summer sessions, you can work full time (up to 40 hours per week).  If you are confused whether a job is considered on-campus employment, ask the employer before you accept the role.

    Optional Practical Training (OPT)

    F-1 students are permitted to work off-campus in Optional Practical Training (OPT) status both during and after completion of their degree. You can apply for OPT after being enrolled for at least 9 months, but you can’t begin employment until you receive your Employment Authorization Document (EAD) and you have been enrolled at the college for at least a year.

    To qualify as OPT:

    • The employment must be directly related to your major
    • You must apply for OPT before completion of all work towards a degree
    • OPT is permitted for up to 12 months (full-time) in total
    • You can complete 12 months of OPT for each successive level of degree achieved – for instance 12 months of OPT after receiving your undergraduate degree, and a further 12 months after receiving your graduate degree.

    OPT before completing a degree:

    • You must be enrolled in school full-time
    • You can only work 20 hours per week while school is in session
    • But you may work full-time during summer and other breaks (as long as you will return to school after the break)
    • You may work full-time after completion of all coursework, if a thesis or dissertation is still required and student is making normal progress towards the degree

    OPT after completing a degree:

    • After completion of your degree, OPT work must be full time (40 hours/week)
    • All OPT must be completed within 14 months after completion of your degree
    • Applications for post-completion OPT must be submitted before the completion of your degree

    Curricular Practical Training (CPT)

    Curricular Practical Training (CPT) is another off-campus employment option for F-1 students where practical training is an integral part of their curriculum or academic program. CPT employment is defined as ‘alternative work/study, internship, cooperative education, or any other type of required internship or practicum that is offered by sponsoring employers through cooperative agreements with the school’.

    To be eligible for CPT employment:

    • You must have been enrolled in school full-time for one year on valid F-1 status (except for graduate students where the program requires immediate CPT)
    • The CPT employment must be an integral part of your degree program or requirement for a course for which you receive academic credit
    • You must have received an eligible job offer before you submit your CPT authorization request
    • Your job offer must be in your major or field of study

    Note: All OPT and CPT employment requires prior authorization from your school’s International Student Office. And if you work for 12 months or more of full-time Curricular Practical Training (CPT) you will not be eligible for OPT.

     

    (4) Leaving and re-entering the US

    Thinking of heading home for a holiday during a break in semester?

    As long as your absence from the US is for no less than 5 months, you will have no problem leaving and re-entering the US on an F-1 visa.

    However, you will need to have some important documents in order to ensure your re-entry to the US is successful. These include:

    • a valid Form I-20 (Certificate of Eligibility for Non-immigrant Student Status) with a current DSO signature (valid for one year) from the school that you attend in the US
    • a valid F-1 student visa stamp
    • a valid passport or travel document

    To maintain your F-1 visa status you will need a passport that is valid for at least six months into the future. Your country’s consulate or embassy can help you extend your passport if needed.

    Note: If you have completed your program you will not be able to re-enter the US as an F-

    1 student unless you have been admitted to a new program of study and have a new Form I-20, or you are returning to an authorized OPT job.

     

    (5) Don’t forget your taxes!

    To maintain a valid F-1 visa, you are required by law to file a tax return if you were in the US during the previous calendar year. Filing a tax return is probably the last thing you’ll want to do when you’re enjoying an exciting time in the US. Fortunately help is on hand!

    Sprintax can prepare your Federal and State tax returns for you. And we guarantee to maximize your tax refund too! Last year 9 out of 10 Sprintax users with a Federal filing requirement were due a tax refund. What’s more, the average Federal refund was over $1,000.

    So what are you waiting for? Get started today!

     

  • Do I need an ITIN?

    As an international student in the US, it is important that you understand the tax requirements of your visa.  Here we explain everything you need to know about ITIN and how we can assist you.

    What is an ITIN?

    An Individual Taxpayer Identification Number (ITIN) is a tax processing number issued by the Internal Revenue Service (IRS). If you expect to receive taxable Scholarship, Fellowship or Grant Income and you do not qualify for a Social Security Number (SSN) you must apply for an ITIN. ITINs are issued regardless of immigration status because both resident and nonresident aliens may have a US filing or reporting requirement under the Internal Revenue Code.

    Why do I need an ITIN?

    There are a number of circumstances why someone may require an ITIN.  Individuals falling under the following categories that do not have, have never had, or are ineligible for, a US Social Security Number may require an ITIN:

    • A Nonresident alien expecting to receive taxable Scholarship, Fellowship or Grant Income and who is not eligible for an SSN
    • A Nonresident alien required to obtain an ITIN to claim a tax treaty benefit;
    • A Nonresident alien filing a US tax return and who is not eligible for an SSN;
    • A Nonresident alien filing a US tax return only to claim a refund;
    • A US resident alien (based on days present in the United States) filing a US tax return and not eligible for an SSN

    What documents do I need?

    The IRS has streamlined the number of documents it will accept as proof of identity to obtain an ITIN. There are now 13 acceptable documents. An original, or a certified copy, of an unexpired passport is the only document that is accepted for both identity and foreign status. If you do not have a passport, you must provide a combination of current documents that contain expiration dates.

    The IRS will accept documents issued within 12 months of the application if no expiration date is normally available. The documents must also show your name and photograph if they support your identity, and your permanent domicile (place of birth, permanent foreign address), to support your claim of foreign status. The IRS will accept certified copies of a combination (two or more) of the following documents, in lieu of a passport:

    • National identification card (must show photo, name, current address, date of birth, and expiration date)
    • US driver’s license
    • Civil birth certificate
    • Foreign driver’s license
    • US state identification card
    • Foreign voter’s registration card
    • US military identification card
    • Foreign military identification card Visa
    • US Citizenship and Immigration Services (USCIS) photo identification
    • Medical records (dependents – under 14 years old – only)
    • School records (dependents and/or students – under 25 years old – only)

    It’s important to note that, if you are sending your ITIN application with a tax return, all documents will need to be certified by a Designated School Official (DSO) or by a certifying acceptance agent.

    Sprintax will help you to select the proper set of documents for your application.

    When can I expect to receive my ITIN?

    It can take 6 to 8 weeks and sometimes longer to obtain an ITIN. And it’s important to be aware that it can often take more than one application before you successfully receive an ITIN. The IRS is generally efficient in informing applicants of any issues with the process. Once your application is complete you will receive a letter from the IRS assigning your tax identification number.

    How Sprintax can help!

    Sprintax will guide you through the process of applying for your ITIN.

    There are two options for applying for an ITIN with Sprintax.

    If you have received income in the US without an ITIN or SSN, the Sprintax NR service will help you to obtain an ITIN and to file a federal tax return.

    Meanwhile, the Sprintax ITIN service is for students who need an ITIN before the end of the tax year so that they can receive their scholarship.

    To get started, you can register at: https://itin.sprintax.com/

  • My state residency differs to my federal residency. How is this possible?

    We’re here to clear your residency confusion!

    All Foreign Nationals living, working or studying in the US are responsible for their personal compliance with the United States Federal and State tax laws and regulations.

    But what are these laws and regulations?

    Well, for starters, every foreign national living in the US is required to submit an annual income tax return. But the type of tax return you will need to file depends largely on where you live and work.

    In the US, Federal income tax is collected by the Internal Revenue Service (IRS). Most States (42 States plus the District of Columbia to be exact!) also have additional State income tax which is collected separately by the various state authorities. People that live in one of these 42 States may be required to submit a State return in addition to the Federal return.

    To file correct tax returns, it is important for a foreign national to recognize how the IRS and the different State tax offices determine tax residency.

    File your US tax returns with Sprintax

    Federal residency

    The IRS tax code provides two separate tax reporting requirements – one for US citizens and resident aliens and another one for non-resident aliens.

    Before a non-citizen of the US prepares and submits a tax return to the IRS, they must determine their correct residency status.

    But how can you do this?

    Well, the IRS has two tests for determining residency status: the ‘green card’ test and the ‘substantial presence’ test (SPT).

    Substantial presence test

    The substantial presence test (SPT) identifies foreign individuals who spend substantial periods of time within the United States as resident aliens.

    You will be considered a ‘resident for tax purposes‘ if you meet the SPT for the previous calendar year. To meet this test, you must be physically present in the United States for at least:

    • 31 days during the current year, and
    • 183 days during the 3-year period that includes the current year and the 2 years immediately before that, counting:
      • All the days you were present in the current year, and
      • 1/3 of the days you were present in the first year before the current year, and
      • 1/6 of the days you were present in the second year before the current year.

    Students on F-1 and J-1 status are typically considered non-resident aliens for Federal tax purposes for the first 5 years in student status.

    On their 6th year they can begin counting days of presence for the SPT. If they pass the test – their status changes from non-resident to resident for tax purposes.

    Scholars, interns and trainees, teachers, researchers and research-scholars on J-1 status are considered non-resident aliens for Federal tax purposes for their first 2 years in the US.

    However, on their 3rd year, they can also begin counting days for the SPT. And if they pass the test – their status changes from non-resident to residents for tax purposes.

     Other non-immigrant statuses are also dependent on the substantial presence test.

    Green card

    A green card is simply an informal term for a United States Permanent Resident Card. But how can you get one? In reality, the green card test is actually pretty straight forward.

    A non-resident alien can become a US resident for tax purposes at any time if they have been given the privilege, according to immigration laws, of residing permanently as an immigrant. This status usually exists when the Bureau of Citizenship and Immigration Services issue an Alien Registration Receipt Card (Form I-551), or green card, to an individual.

    Should you qualify for a green card, you will automatically become a US tax resident, starting from the year you first qualified.

    State residency

    It’s important to note that, State and Federal residency are not the same thing.

    Each State follows an entirely different set of rules and regulations when determining state residency status.

    So even if you are a non-resident for federal tax purposes you may be a resident for state tax purposes.

    Because the rules and regulations vary by state, determining state residency is more complicated than it seems.

    Each state has a complex and differing definition of what constitutes a resident. Most states will look at a list of residency ‘factors’ that have been long established like domicile (permanent residency), or the day counting rule. Owning a home, family location, and financial interests are other factors which help some of the states determine residency.

    In other words – a person may be considered a resident of the state in which he or she currently lives because of the state residency factors, but still be considered a non-resident for federal tax purposes because they didn’t pass the SPT or the green card test.

    Sprintax can help you determine your residency status

    To make things even more complicated, some States have a third residency status (in addition to ‘resident’ and ‘non-resident’) which is called ‘part-year resident’.

    And, for people who live or study in one state and work in another, things can quickly become tricky as they might need to file more than one State tax return and they will need to determine their State residency for both States!

    Preparing your tax return

    Sill confused? Don’t worry! Sprintax will figure out both your Federal and State residency statuses so that you don’t have to. We will also prepare your Federal and State tax returns, regardless of your State residency status!

    Sounds great! Get me started!