All posts tagged Non-resident tax return

  • J-1 visa taxes explained – the ultimate US tax return guide for J-1 visa holders

    J1 visa tax return guide 2022

    Tens of thousands of people flock to the US on J-1 student 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 “J-1 visa taxes explained – the ultimate US tax return guide for J-1 visa holders” »

  • Tax guide for summer camp counselors on J-1 visa

    J1 tax return summer camp counselors in 2024

    The camp counselor program allows you to share your culture and ideas while working in a camp setting in the US.

    To take part in the camp counselor program, you need a J-1 cultural exchange visa. This visa allows non-immigrant aliens to temporarily live in the US to participate in the summer camp.

    Generally, J-1 camp counselors are considered nonresidents for tax purposes. You must fill out important tax documents when you arrive at the camp, and your camp director can help you with this. Continue reading “Tax guide for summer camp counselors on J-1 visa” »

  • Nonresident alien tax filing explained

    NRA tax guide

    Last updated: 26 Jan 2024

    Whether you are dreaming of a trip to the US, or you are about to embark on one, the prospect of jetting off to The Land of Opportunity is bound to be exciting.

    While you get to grips with the culture in the US, one area that often confuses nonresidents is tax.

    That’s why Sprintax is here!

    We specialize in making tax as straightforward as possible to newcomers in the US.

    So, without further ado, here’s our ultimate guide to filing taxes as a nonresident in the US. Continue reading “Nonresident alien tax filing explained” »

  • How to file your nonresident tax return from outside the US

    Need to file a US nonresident tax return from outside America?

    Don’t worry. You’re not alone! Countless nonresidents face this very predicament every year.

    Filing from outside the US can pose its own unique set of challenges. But, with some planning, organization and a little help from your friends at Sprintax, filing your documents can be easier than you think!

    In this handy guide, we’ve got 5 top tips to follow if you’re filing your nonresident tax documents from outside the US.
    Continue reading “How to file your nonresident tax return from outside the US” »

  • Which tax form should I use: Form 1040, 1040NR or 1040NR-EZ?

    Form 1040NR vs 1040 vs 1040NR-ez

    (Last updated: 21 Sep 2023)

    Important: Since 2020, the IRS no longer uses form 1040-NR-EZ. Form 1040NR has been simplified and will be used instead.

    Coming to the US from a foreign country presents both thrills and challenges to every nonresident. One of the more common difficulties nonresidents face is filing their tax return.

    In this blog post, we’ll be discussing Forms 1040, 1040NR, 1040NR-EZ, and how they apply to each person’s situation.

    Form 1040 (NR & NR-EZ) figures out the total taxable income of the taxpayer and determines how much of a refund the person may be due.

    So, without further ado, let’s examine how to find out which form applies to you! Continue reading “Which tax form should I use: Form 1040, 1040NR or 1040NR-EZ?” »

  • Your frequently asked nonresident tax questions answered

    nonresident alien FAQs

    (Last updated: 1 Aug 2023)

    Here are the answers to some of the most frequently asked questions about U.S. taxes. Continue reading “Your frequently asked nonresident tax questions answered” »

  • 13 US tax questions every nonresident student asks us!

    Are you a nonresident student in America? Do you find US tax to be confusing?

    Don’t worry, you’re not alone! Even for the most financially savvy US citizen, American tax can be pretty tricky.

    That’s why we’ve prepared a list of common questions nonresidents ask us and answer them here in this handy blog!
    Continue reading “13 US tax questions every nonresident student asks us!” »

  • How to be a tax champion… everything a nonresident student athlete needs to know about tax rates, treaty benefits, NIL income & more!

    Everything nonresident student athlete needs to know about tax rates, treaty benefits, NIL income

    In this guide, we will discuss:

    • Tax considerations for collegiate nonresident athletes
    • How much tax do nonresident athletes pay in the US
    • Can an international athlete claim any tax treaty benefits
    • How to file a tax return as a foreign sportsperson
    • And more!

    Continue reading “How to be a tax champion… everything a nonresident student athlete needs to know about tax rates, treaty benefits, NIL income & more!” »

  • 23 tax tips for nonresidents to maximize their US tax refund in 2023

    U.S. nonresident tax-refund tips for 2023

    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 23 tax tips that can answer your questions and help you trim your tax bill and maximize your US tax refund in 2023.

     

    1. Remember! You have to file a nonresident tax return in the US

    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 now 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.

     

    2. Even if you did not earn US-sourced income, you may still have a filing requirement

    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.

     

    3. You must file if you were self-employed or earned income from investments or cryptocurrency

     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

     

    4. Correctly determine your tax residency status

    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:

    1. Have been issued a Green Card, or
    2. Meet the Substantial Presence Test guidelines, which state that you have been in the US for at least 31 days in the current year and 183 days in the previous two years.

    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!

    Determine my residency status

     

    US nonresident alien tax refund tips

    5. Figure out your tax obligations

     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

     

    6. You must also file if you received a gift or inheritance

    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.

     

    7. Consider the tax implications of receiving a scholarship or fellowship

    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.

     

    8. Be aware of the tax implications of on-campus employment

    While studying, international students may be allowed to work on campus, but they must report their earnings on their tax returns.

     

     

    9. Know the rules for off-campus employment

    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.

     

    10. Understand the tax implications of self-employment

    Self-employed international students might also be required to pay regular income tax in addition to self-employment tax.

     

    11. Organize your tax records. Having a clean tax record counts

    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.

    tax tips 

    12. You may be required to file a federal and state tax return

    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.

     

    13. Understand your tax treaty entitlements

    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.

     

    14. Understand the difference between tax deductions and tax credits

    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.

     

    15. Make sure you have your SSN / ITIN

    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).

     

    US tax deadline

    16. File early to avoid tax deadline stress

    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.

     

    17. Or at least file before the deadline to avoid fines and penalties

    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.

     

    18. If you miss the deadline it is still important to file

    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 student tax refund USA

    19. Plus, you may be due a tax refund!

    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

     

    20. Even if you have already left the US you should still file and you can still collect your tax refund

     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?

     

    21. Register with Sprintax, here’s why

    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.

     

    22. No, if you are a non-resident, you can’t file with TurboTax (Don’t file as a resident if you are a non-resident)

    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

     

    23. Plus – you can E-file with Sprintax which will save you a lot of tax stress at the deadline

    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.

    Still have questions?

    You can contact Sprintax Live chat to help you with the tax preparation process.

    Remember, you must file your tax documents before 15 July.

    With Sprintax you can:

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

    Prepare your US nonresident tax return today!

     

  • Your US Tax Residency Status Explained

    US residency for tax purposes

    Last updated: 16 January 2023

    Resident or Nonresident – this is the question!

    Determining your tax residency status is important, as it will determine how much tax you must pay while in the US.

    The most common mistake nonresidents make is filing their taxes as a resident. If a nonresident files as a resident they can claim benefits and receive refunds that they’re not entitled to. Incorrect filing breaks the terms and conditions of a nonresident visa, this can lead to fines and penalties and you may also jeopardize your future visa or green card applications.

    In this article, we will discuss everything you need to know about your residency and how you can determine your residency status.
    Continue reading “Your US Tax Residency Status Explained” »

  • What are my tax obligations as a nonresident self-employed worker in the US?

    self-employed and freelancers tax obligations

    (Last updated: 13 June 2022)

    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?” »

  • Are nonresidents subject to tax if they receive a Form 1099-K?

    Form 1099-K tax guide for US international students

    If you have received an IRS 1099-K form, you may be wondering whether the document has any implications for your tax requirements in the US.

    You may receive a 1099-K document (also referred to as a Payment Card and Third Party Network Transactions form) if you received payments through credit or bank card transactions. Continue reading “Are nonresidents subject to tax if they receive a Form 1099-K?” »

  • How to get the forms you will need to file your taxes as a nonresident

    forms you need to file nonresident tax return

    (Updated for 2023)

    Tax season can be a difficult time for nonresidents in the US. After all, you are filing taxes in an unfamiliar country!

    However, it’s not all bad – Sprintax is here to help!

    And while filing your taxes may seem like a big job, you can make the job easier by breaking it down into smaller tasks.

    Step one is to gather all of the income forms and documents you will need in order to file your return. Continue reading “How to get the forms you will need to file your taxes as a nonresident” »

  • The dangers of not filing a tax return

    Not filing a tax reurn

    If you have worked or studied in the USA, did you know that you are obliged to file taxes?

    Many nonresidents are unaware of this fact due to a combination of factors, such as busy lifestyle or they have left the country.

    However, whatever the case may be, not filing your taxes has very serious consequences.

    If you are a nonresident and still live in the US, continuing to avoid your responsibility can result in automatic wage seizure by the courts, asset seizures like your car and may even lead to arrest and jail time for tax evasion.

    What happens if I don’t file?

    If you do not pay the taxes you owe by the tax deadline (15 April every year, except 2020 and 2021 which were 17 May and 15 July respectively) you could be hit with a variety of punishments.

    Here are a few different dangers of not filing your tax return:

    You could miss out on your tax refund!

    If you are entitled to a tax refund, you won’t be punished for filing late by the IRS.

    If you wait longer than three years from the date your refund is published, however, you will lose out on your chance to claim the refund as it will automatically be handed over to the US government.

    You could be hit with fines and penalties

    If you have unpaid taxes, you will owe the IRS interest in addition to any penalties.

    You should do your best to file your tax return before the deadline to avoid facing penalties and fines!

    The penalty for filing late is normally 5% of the unpaid taxes for each month or part month that a tax return is late. That penalty starts accruing the day after the tax filing due date and will not exceed 25% of your unpaid taxes.

    If you file your tax return more than 60 days after the due date or extended due date, the minimum penalty is strong – $135 or 100% of the unpaid tax, whichever is less.

    If you do not pay your taxes by the tax deadline, you will normally face a failure-to-pay penalty of 0.5% of your unpaid taxes.

    Residency status for tax purposes

    Can I file if I have left the US?

    Yes!

    You can file your US tax return with Sprintax from anywhere in the world!

    Sprintax is the only online Federal and State self-prep tax software for nonresidents in the US!

    Our system will assist you in preparing fully compliant Federal and State tax returns and secure your maximum legal tax refund.

    The average federal refund in the US is $1,126!

    With Sprintax you can:

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

    Complete your nonresident tax return today!

  • How to File Prior-Year Tax Returns as a Nonresident Alien

    File previous year tax return

    People do not file their taxes for a variety of reasons. Perhaps you forgot or were unaware that you had to file. Perhaps you had a hefty tax bill that you could not cover.

    Whatever the reason, if you did not file your tax return by the deadline, you should do it as soon as possible. Otherwise, you risk being hit by fines, and you can jeopardize your future visa applications.

    As a nonresident, you probably know that you have the obligation to file a tax return if you were in the US for just one day, and even if you did not earn any income in order to stay compliant with your visa tax commitment.

    This guide will outline everything you need to know as a nonresident if you did not file your prior-year tax return(s). So, keep reading!

    Continue reading “How to File Prior-Year Tax Returns as a Nonresident Alien” »