All posts in J1 Taxes

  • A Complete Tax Guide for Au Pairs in the U.S.

    Au Pair Taxes Explained by Sprintax

    According to the IRS (Internal Revenue Service) there are up to 12,000 au pairs in the US at any stage during the year (source).

    We’ve put this handy guide together to fill you in on everything you need to know about foreign au pairs and tax in the US.

    About the Au Pair Program

    What is Au Pair?

    An au pair is an individual between the ages of 18 and 26, who travels from their home country to live in the US with a family and work as a caregiver (foreign nanny). An au pair comes to the US as an Exchange Visitor on a J-1 visa and is not allowed to remain in the United States longer than one year.

    Working as an au pair is an unrivaled opportunity to experience the American way of life – and for those who are not native English speakers, it’s a chance to learn and practice the language.

    You can find more about the Au Pair program here.

    Au Pair Income

    Au Pairs in America receive a cash stipend (tied to the U.S. minimum wage) from the host family. The au pair stipend constitutes “wages” because an employer-employee relationship exists between the au pair and their host family.

    Au pairs must report this income to the IRS and it’s subject to income tax.

    One of the many challenges that an au pair may face when they arrive in the US is coming to terms with the US tax system.

    Do Au Pairs have to pay taxes?

    In short, yes.

    All payments that you have received as an au pair from your host family, which cover the cost of any required academic coursework, room and board, or compensation for childcare work are subject to income tax.

    As a nonresident, au pairs will owe tax on all of the money they earned from US sources.

    Although au pair wages are not subject to mandatory U.S. income tax withholding and reporting on form W-2, au pairs must file an income tax return.

    Filing an Income Tax Return

    You will need to apply for a Social Security Number (SSN) or for an Individual Taxpayer Identification Number (ITIN), whichever is applicable in your case, in order to file your US Federal tax return.

    In the United States, besides federal tax, there are also state taxes and local taxes. Whether you need to file a state tax return will depend on the tax rules of the state in which you lived and /or worked, as some states do not require you to pay state tax.

    In order to reduce your tax liability during filing, the IRS permit au pairs to pay tax in quarterly instalments. To do this, all you’ll need to do is submit Form 1040NR-ES (estimated tax return) to the IRS on a quarterly basis and enclose a cheque for the amount you are paying. You may also pay your tax in full at the end of the tax year with your 1040NR-EZ.

    Prepare your Au pair taxes hassle-free with Sprintax

    What taxes are Au Pairs exempt from?

    Because au pairs are paid for their work in the setting of a private home, they are not subject to mandatory US income tax withholding and reporting on Form 941 and W-2.

    Wages will also be exempt from social security and Medicare (FICA) taxes because of the au pair’s status as a nonresident alien. However, if you had previously been in the United States as a student, teacher, trainee, or researcher in F, J, M, or Q non-immigrant status, then you may be classed as a resident alien, meaning you may be subjected to these taxes.

    Tax deductions

    Most au pairs are considered nonresident aliens for tax purposes, so they are not eligible for the Earned Income Tax Credit, the Hope Credit or the Lifetime Learning Credit.

    What happens if an au pair does not pay taxes?

    It’s important to note that, by not filing your tax return, you can severely jeopardize your chances of securing a US visa or Green Card in the future.

    How to pay taxes

    If the case arises where you end up owing additional taxes along with your return, you have various options to pay. The most common forms of paying are pay by check, bank transfer or your credit or debit card.

    You may need to prepare a payment voucher and mail it to the IRS with a check or money order if you choose this payment method.

    If you choose to pay with a payment voucher, Sprintax will provide the filled out form for you. You will find detailed information about the method you have chosen in your instructions.

    Check out this guide on what to do if you missed the tax deadline.

    How to file my US tax return as an Au pair

    Usually, you have until 15 April of every year to file your tax return, however – with the ongoing COVID19 pandemic causing chaos across the globe, the deadline for 2020 has been moved forward to 15 July.

    • In order to file your au pair tax return you need:
      Your Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN);
    • Calculate how much you earned in the US during the previous calendar year. The simplest way is to multiply your weekly stipend with the number of weeks you worked as an au pair;
    • File form 1040NR-EZ with the IRS;
    • Send a payment to the IRS with the amount of any taxes owed.

    At Sprintax, our software has the capabilities to help you to prepare your federal tax return easily online. We will also assist you with your state tax return.

    By preparing your tax documents with Sprintax, you can also ensure that you receive your maximum tax refund! And with the average Sprintax user receiving a tax refund of $1,153, it’s easy to see why it’s worth your time checking to see what you are owed!

    With Sprintax you can:

    • Save time and stress!
    • Determine your residency status
    • Prepare a fully compliant US tax return
    • Maximize your State tax refund if available
    • Avail of our 24/7 Vita Qualified Live Chat facility

    Prepare your Au Pair tax return today!

  • The ultimate US tax guide for J-1 participants

    Tens of thousands of people flock to the US on J-1 visas each year.

    Every J-1 participant has a tax filing requirement, it’s the law!

    Many J-1 visa holders are confused by the often tricky US tax jargon. However, it’s not as bad as it seems, and knowing even a little about your filing requirements can go a long way!

    With this in mind, we’ve created a blog post that will answer some common queries from J-1 participants in the US! Continue reading “The ultimate US tax guide for J-1 participants” »

  • 5 documentos de impuestos de EE.UU. que todo participante J1 o estudiante internacional debe conocer

    Tax solutions for nonresidents in the US

    Aceptémoslo – El tema de impuestos es muy aburrido!

    Y cuando vas a EE.UU. como participante J1 o estudiante internacional, el sistema tributario local será probablemente lo último en lo que pienses.

    Sin embargo, aburrido o no, el cumplimiento con las autoridades fiscales– el IRS – es crucial para todo participante J1 o estudiante internacional. En efecto, es una de las condiciones de tu visa! Y el manejo de tus asuntos fiscales en territorio americano. puede jugar un papel muy importante en el resultado de tu futura visa o aplicación para una Green Card.

    Pero, hacer una lectura rápida sobre los impuestos de EE.UU. al llegar al país, puede ahorrarte muchos dolores de cabeza en el futuro.

    Como no-residente, hay un número de formularios y documentos con los que necesitas familiarizarte mientras te encuentres allá

    En este blog, encontrarás una guía de 5 de los documentos fiscales más importantes y los casos en que deben ser utilizados, por qué necesitas presentarlos, y la manera más fácil de completar cada uno. Continue reading “5 documentos de impuestos de EE.UU. que todo participante J1 o estudiante internacional debe conocer” »

  • Utilizar TurboTax para reclamar tu reembolso de impuestos J1 es ilegal

    Testimonial image for Sprintax

    Es difícil imaginar algo peor que el IRS (Internal Revenue Service, Servicio de Ingresos Internos) después de la experiencia J1 de tu vida.

    Sin embargo, esto es exactamente lo que puede suceder si presentas una declaración de impuestos incorrecta de Estados Unidos.
    Continue reading “Utilizar TurboTax para reclamar tu reembolso de impuestos J1 es ilegal” »

  • Her J-1 katılımcısının ABD vergileri hakkında bilmesi gereken 5 şey

    student j1 tax refund US
    • Başkan Trump’ın ‘Vergi Kesintileri ve İş Kanunu’ J-1 vize sahipleri için ne anlama gelmekte.
    • J-1 yükümlülük ve haklarını anlamak.
    • Sprintax – J-1 vergi iadesine başvuru yapmak için en kolay yol.

    Continue reading “Her J-1 katılımcısının ABD vergileri hakkında bilmesi gereken 5 şey” »

  • Using TurboTax to Claim Your J1 Tax Refund is Illegal

    Testimonial image for Sprintax

    It’s hard to imagine anything worse than the IRS (Internal Revenue Service) sniffing around after your J1 experience of a lifetime.

    But this is exactly what can happen if you file an inaccurate US tax return.

    If you worked in the US on a J1 visa, then chances are you are legally obliged to file your US tax return by the Apr 15 deadline.

    So for example, if you’re on a J1 in 2018, then you should file your tax return by April 15 2019. If you file your US taxes correctly, you won’t run into any trouble later on. This is important if you ever wish to return to the US on another visa or for a holiday.

    If you go to US on a J1 visa, you’ll be considered a non-resident for tax purposes and must file as a non-resident.
    Continue reading “Using TurboTax to Claim Your J1 Tax Refund is Illegal” »

  • 5 things every J-1 participant needs to know about US tax

    Tax for J-1 students
    • What President Trump’s ‘Tax Cuts and Jobs Act’ means for J-1 visa holders
    • Understanding J-1 tax obligations and entitlements
    • Sprintax – the easy way to prepare a J-1 tax return!

    Continue reading “5 things every J-1 participant needs to know about US tax” »