As a nonresident in the US, IRS Form 1040-NR is one of the most important tax forms you will need to familiarize yourself with when tax season comes around.
After all, the 1040-NR is the form you will use when filing a tax return with the IRS.
In this blog, we’ll analyze whether or not you need to file 1040-NR, and share our top tips on how to file your tax return correctly.
In this guide, we will discuss:
Understanding the complex tax system can be a daunting task for interns and trainees on J-1 visas.
However, knowing which taxes you need to pay, which ones you don’t, and how to file your tax return correctly is crucial.
That’s why our team has prepared this guide that will help simplify the process and ensure that you’re compliant with US tax laws.
Continue reading “Navigating taxes for J-1 interns and trainees: a comprehensive guide” »
Let’s face it…
Nobody wants to pay more tax than they need to!
That’s why, if you’re working while in the US as a nonresident alien, it’s very important to fill out your tax and pre-employment documents correctly.
Besides, how you handle your US tax affairs can also play a big part in whether or not your future visa or Green Card applications will be successful.
One of the most important forms that you’ll need to complete is the W-4 form.
In this blog we’ll lay out some of the key information you need to know before filling out the W-4 form as a nonresident alien, so that the correct amount of tax is withheld from your paychecks.
Continue reading “The W-4 tax form explained for nonresident aliens” »
It’s a common consideration among students who have built a life and career in the US during their studies.
Fortunately, there are several options available for those seeking to extend their stay beyond their student visa.
In this post, we’ll delve into these options and provide expert guidance on how to manage the transition. Continue reading “I want to stay in the US after my F1 visa expires. What are my options?” »
Curricular Practical Training (CPT) is an excellent opportunity for F-1 students to gain practical experience in their field of study.
Although, one thing you might not have considered is the tax implications of CPT income as a nonresident in the US.
In this guide, we provide a comprehensive overview of what you can expect when it comes to CPT taxes.
Continue reading “CPT student tax essentials: what you need to know” »
Are you going to the US to work for the winter season?
If so, it’s likely that you have many questions on the types of winter work jobs available, the Winter Work and Travel program, H-2B visas, tax residency status, claiming your tax back afterwards, and more!
In this article, we will delve deeper into the above topics to answer frequently asked questions. Continue reading “Tax information for nonresident winter workers in the US” »
In recent years, the act of donating plasma has gained popularity not just for its potential to save lives but also for its financial compensation.
As more individuals turn to plasma donation centers to earn extra income, it’s essential to understand the tax implications associated with this practice.
The topic can be a confusing issue for many, with a recent surge in nonresidents wondering if money they received from plasma donations is taxable.
In this guide, we’ll delve into the world of plasma donations and uncover what you need to know to stay compliant with tax regulations.
Last Updated: 16 Apr, 2024
Every nonresident alien in the US is obliged to file a federal tax return before the tax deadline, which in 2024 is 15 April.
If you’re an international student or scholar in the US, by law you must file Form 8843 at least, but depending on your circumstances, you may also need to file a Federal tax return by filing a 1040NR, a State Tax return or two and maybe even a FICA return.
Not filing a tax return could get you into a whole heap of trouble, leaving you with hefty tax fines and penalties, on top of possible problems getting US visas in the future. Continue reading “Missed the US tax return deadline? Here’s how to file late taxes” »
(Last update: 15 Apr, 2024)
“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
Taxation in the United States is unique and complicated, especially if you are a nonresident. Maybe you have a lot of questions when you complete your tax return and don’t want to pay a cent more than you have to.
This is where this blog may help you.
Here are 24 tax tips that can answer your questions and help you trim your tax bill and maximize your US tax refund in 2024.
If you are a nonresident alien living and working in the United States, you must file an income tax return. This applies to all nonresident aliens studying there on an F Visa, J Visa, M Visa, or Q Visa.
The easiest way to file your US nonresident income tax return is online with Sprintax or by mailing a paper return (Form 1040-NR) to the Internal Revenue Service.
Sprintax is approved by the IRS to submit Federal tax returns online (E-Filing). In short, you no longer have to download, print, and mail a physical copy of your tax return to the IRS.
If you earned income, you have to file a non-resident income tax return on Form 1040-NR. If you did not earn any income you may need to file a Tax Form – 8843.
Each individual who is a nonresident alien and is present in the United States under an F, J, M, or Q immigration status (both “-1” and “-2”) is required to file Form 8843, regardless of age or income received.
If you have made a profit from trading cryptocurrency on a US exchange or broker while living in the US, you are required to declare that income.
The IRS treats cryptocurrency as property, and any profit made from it will be subject to Capital Gains Tax at 30% and must be reported on your 1040-NR tax return.
However, if you dispose of your investment for a loss, you will not need to pay tax, but as a nonresident, you will not be able to use the losses to offset any future tax liabilities.
The same applies to investment profit. Dividends received from your investments will also be subject to a 30% tax. Keep in mind that you may be eligible for a reduced tax rate or tax exemption if you are able to claim tax treaty benefits
As an international student, if you work in the United States you will be taxed, but the extent to which you are taxed will depend on your residency status and where your income, whether from employment or capital gains, was earned or sourced from.
Not all nonresident aliens will meet the residency requirements for filing a US income tax return.
You are only considered a US Resident if you:
If you struggle with determining your residency status, don’t forget that Sprintax allows you to complete the substantial presence test and determine your tax residency status for free!
Nonresident students are generally taxed on their US source income, such as wages or salaries earned in the United States which includes money earned while in the country.
The IRS, on the other hand, has no authority to levy taxes on income earned by nonresidents in their home countries or any other foreign country.
You may also be required to file a nonresident tax return if you receive certain types of income, such as wages, scholarships, fellowships, rental income, interest, dividends, and grants. However, certain types of income may be exempt from income tax, such as gifts, bequests, and inheritances.
Read more: US tax season survival guide for international students on F-1 visas
Gifts and inheritances may be taxable to the donor or tax-free, depending on the amount of the gift or inheritance and the relationship between the donor and the recipient.
Scholarships and fellowships may be taxable or tax-free, depending on the terms of the award and how the funds are used. It’s the same with grants.
While studying, international students may be allowed to work on campus, but they must report their earnings on their tax returns.
International students may also be able to work off campus, but there are strict rules governing this type of employment.
For instance, in order to work off campus, students must have permission from US Citizenship and Immigration Services (USCIS), and they might have to pay social security and Medicare taxes.
Self-employed international students might also be required to pay regular income tax in addition to self-employment tax.
The most difficult part of the tax season for many people is gathering all the necessary documentation. This includes last year’s tax return, W-2s, 1099s for this year, receipts, other income documents, and canceled checks.
It’s important to keep good records of your income, deductions, and other tax-related information. This will make it easier to file your 1040-NR tax return and ensure that you are paying the correct amount of tax.
Good organization may have financial rewards. Find out what forms you need and print out a tax checklist.
International students may need to file a federal income tax return using Form 1040NR if they have US-source income, or Form 1040 if they are considered resident aliens.
Whether or not international students should file a state tax return depends on the state they live in and the amount of their income.
Those who reside in states which do not collect income taxes may not be required to file a state tax return. However, even if they are exempt from filing a federal tax return, they may still need to file a state tax return in some states if their income exceeds certain thresholds.
It’s crucial to confirm the requirements for the state in which you currently reside because they can differ from one state to another. Sprintax can help you determine your state filing requirements.
Understand the tax treaty between your home country and the United States.
Many countries have a tax treaty with the United States that can affect your tax obligations.
For instance, the treaty may provide a lower tax rate on certain types of income or allow you to claim certain credits or deductions.
You need to understand the distinction between tax credits and tax deductions and figure out which are applicable for nonresidents. Both can reduce what you owe on your tax bill but in different ways.
Tax credits directly reduce the amount owed on taxes by providing a dollar-for-dollar reduction in your tax bill. Tax credits are more valuable than tax deductions in general because they lower the amount you must pay, whereas a tax deduction reduces your taxable income.
Changes in the taxation of nonresidents under the Tax Cut and Jobs Act practically waived most of the deductions that they can claim. The following are not available anymore: personal exemption and itemized deductions except the state tax deduction.
You can only use as a deduction the state and local taxes you pay in the state you worked in.
You still can claim qualified educational expenses you pay out of your pocket if you are a student at a US educational institution but only to the amount of your grant/scholarship.
In general, tax credits are not granted to nonresident aliens except in some very rare cases. Nationals of Canada, Mexico, and South Korea, students, and apprentices from India may be eligible to claim either child tax credit for children that are US residents or credit for other dependents if the child is a nonresident alien.
Sprintax can review your details and circumstances for your applicable allowances, deductions, and credits. The software will finalize the calculations and prepare your tax return.
You are required to have a government-issued Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN) before you can file a US income tax return. Make sure you’ve arranged that.
To be eligible for any tax treaty benefits, foreign nationals are required by IRS regulations to possess either a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN).
Most taxpayers claim that tax season is stressful. When you have a daunting task ahead of you, it’s best to tackle it immediately rather than procrastinate.
Worrying over something often causes more anxiety than actually taking action. The same holds true for income taxes.
Filing taxes before the deadline can provide several advantages. Not only does it allow you to avoid the stress of meeting the deadline, but it also ensures that your return is processed as quickly as possible.
By filing early, you can also get a head start on any tax planning or adjustments that need to be made. Furthermore, those expecting a refund will receive it much sooner if they file early.
So, don’t wait until the last minute to file your taxes, get a head start and file early to avoid any unnecessary stress or delays.
The deadline for nonresidents to file their tax return is generally 15 June if they are outside the US, but if you are in the US, self-employed, or have taxes withheld, you may need to file by 15 April. If you need more time to file, you can request an extension, but you will still need to pay any taxes owed by the original deadline.
Penalties and interest will be assessed if you fail to pay your taxes on time. You can also jeopardize any future visa applications.
Nobody wants to get into trouble with the IRS. Don’t panic if you missed this year’s filing deadline but act quickly.
Missing the filing deadline or not submitting your return by the tax extension deadline can result in penalties imposed by the IRS. They charge 5% of the taxes due for each month or part of the month that the tax return is not filed.
International students may be entitled to a tax refund if they had taxes withheld from their income but their tax liability was lower than the amount withheld. To claim a refund, you’ll need to file a tax return and attach any required documentation.
Claim your international student tax refund with Sprintax
As a nonresident, it’s important to know that you may be eligible for a tax refund even after you have left the United States. To get your refund you simply need to file a tax return online.
So why leave your money in the US?
Made a mistake on your tax return? You can fix it by filing an amended tax return.
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 affect the validity of a tax return. Learn more here.
If you are unsure about your tax obligations as a nonresident, Sprintax can help you!
It is a tax preparation software designed specifically for non-US residents who are required to file US taxes.
The software is designed to make it easier for non-residents to prepare and file their US taxes, and claim their US tax refunds.
It will provide step-by-step guidance and assistance with calculating and claiming credits and deductions based on your personal situation.
Sprintax also provides support for filing state and local taxes in addition to federal taxes.
The software is available in a variety of subscription plans and is intended for use by individuals as well as businesses and organizations.
You cannot file your taxes with TurboTax if you are a nonresident.
TurboTax doesn’t support IRS Form 1040-NR (U.S. Nonresident Alien Income Tax Return) while Sprintax offers both federal and state tax preparation for international students, scholars, and nonresident foreign professionals.
What’s more – Sprintax is TurboTax’s partner of choice and the only online solution to offer federal tax e-filing and state tax return preparation for nonresidents!
File Form 1040-NR online with Sprintax
Say goodbye to paper tax returns! You no longer need to download, print and mail a physical copy of your tax return to the US tax office.
Sprintax is now approved by the IRS for E-filing, which means you can file your taxes from the comfort of your own home.
Plus, E-Filing your tax return guarantees faster processing by the IRS compared to mailing a paper tax return.
Remember, you must file your tax documents before 15 July.
Prepare your US nonresident tax return today!
If you are a nonresident alien (NRA) who lived or worked in the US, you will have tax responsibilities, regardless of whether you earned income.
In essence, every nonresident is required to file their taxes.
When you sit down to file you may discover that you owe tax. But don’t worry, it is very common for nonresidents to owe money to the IRS.
In this guide we discover some of the reasons you may owe tax and how to file your tax return
Continue reading “Why do I owe federal tax on my 1040NR tax return?” »
(Last updated: 12 Mar 2024)
It’s tricky being self-employed – after all, you need to keep a close eye on your income and all of your deductible expenses!
It’s even more tricky being self-employed in a country where you are unfamiliar with the local tax rules.
What’s more, when you are considered a nonresident for tax, special rules apply to you when compared with a resident.
In this blog we will cover the key information that nonresident self-employed individuals in the US need to know about their tax filing obligations. Continue reading “What are my tax obligations as a nonresident self-employed worker in the US?” »
Tax season can be difficult for a lot of nonresidents who move to the US.
With so many different aspects of taxes in the US, it can be easy to feel a little overwhelmed.
Filing both state taxes and federal taxes are vitally important to ensure your nonresident state income tax withholding is correct.
Nonresident state tax returns are one of the lesser-known areas of tax for many people, so in this blog post we’ll outline everything you need to know about them as well as how to file them.
So, without further ado, let’s dive right in! Continue reading “How to file a nonresident state tax return” »
Are you living in the United States and recently received a Form 1042-S? Don’t worry; you’re not alone.
Many individuals find themselves in this situation each tax season, and understanding what to do next can remove any potential confusion or stress.
In this guide, we’ll break down everything you need to know if you received a 1042-S form.
Continue reading “I have received a 1042-S – what do I do now?” »