Postdoc Tax Information
It is tax filing season again and we are sure that many of you are questioning whether you must file tax forms, how to complete the forms and much more. This update has been designed to provide students and scholars with basic information and resources about your tax filing obligations, how to complete and submit the correct tax forms on time and how to pay the proper tax or, better yet, receive a tax refund.
All international scholars and students in F-1 or J-1 status as well as dependents in F-2 and J-2 status who were physically present in the U.S. any time between January 1, 2010 and December 31, 2010 must complete and submit some type of 2010 federal tax form. International students and scholars in other immigration classifications may also be required to complete and submit tax forms. The number and type of form you must complete depend on whether you earned income during 2010, the type of income you received, the length of time you have been physically present in the U.S. and other factors.
Taxes are often complicated, even for those native to the United States. There are many different kinds of taxes in the U.S. and different agencies are responsible for collecting these taxes. Please be advised that the staff of the International Students & Scholars Office does not specialize in international tax law and can not answer specific questions regarding your individual tax filing requirement; however, we have prepared the following information to help get you started.
In order to facilitate the filing of tax forms, the ISSO has again purchased a web-based tax return preparation system that is designed exclusively for international students, scholars and their dependents. The Windstar Foreign National Tax Resource (FNTR) is an online tax preparation software that will help you understand your nonresident alien tax obligations and to complete the federal 1040NR or 1040NR-EZ forms. Please be advised that we have purchased a different system than in past year as this new product will also offer you assistance in 1) preparing your Massachusetts State Form1NR/PY (if required depending on your individual tax status and income earned) as well as 2) offer you an extensive online searchable, content library to give you general information about U.S. tax withholdings, tax filing obligations, tax treaties and detailed information if you are required to file a tax return as a dual status filer or resident for tax purposes. An overview of Windstar FNTR can be found at: http://www.windstar.com/public/prodsfntr.html
What is a Tax Return?
In the U.S., federal and state income taxes are prepaid by each employer based on the “estimate” of tax liability indicated at the start of employment by the employee on the Form W-4. Since the withholding is only an estimate, employees are given an annual opportunity to reconcile the amount of tax withheld with how much was owed. The name of the form on which the reconciliation is made is called the “Tax Return”. The federal tax return must be completed and submitted to the Internal Revenue Service (IRS). State tax returns must be submitted to the Massachusetts Department of Revenue (DOR) and/or to the state agency in any other U.S. state where you have received income in 2010. In some cases, filing the tax return results in a refund because the tax withholding was higher than necessary. However, sometimes a taxpayer does not have enough tax withheld throughout the year so you may need to send a payment to the IRS with your tax return. Occasionally, the total taxes withheld match the amount due, so no money is due by either the taxpayer or the IRS.
Must I file a federal tax return AND a state tax return?
The federal government imposes income tax obligations on all individuals who earn income in the U.S. In addition, most state governments impose income tax obligations on individuals who reside and/or work in their states. Therefore, in most cases, individuals must file a federal tax form submitted the U.S. Internal Revenue Serivce plus a second tax form submitted to the tax office of the state in which they reside. If you worked in a state other than the state in which you reside, you may be required to submit an additional tax form tax office of that state.
When must I complete and submit my tax return?
If you have earned income in 2010, all federal and state tax forms must be postmarked by April 18, 2011.
If you have not earned income in 2010 or you are filing from outside the U.S., your forms must be postmarked by June 15, 2011.
Who Must File a Tax Return?
All F-1 and J-1 students and scholars and their F-2 and J-2 dependents are required to complete and submit at least one tax form. In addition, anyone who has earned income while in the U.S. must file a tax return. Taxpayers are divided into three general categories for tax purposes, regardless of income: residents, nonresidents, and dual status aliens.
How do I determine my tax residence category?
It is important not to confuse immigration terms of “resident” and “nonresident” with taxpayer categories that have the same name. Residence for tax purposes is defined based on the Substantial Presence Test (SPT) which is independent from your immigration classification. The SPT is the calculation that the federal government uses to determine when nonresident aliens for immigration purposes have been in the United States long enough to be considered residents for tax purposes. The Foreign National Tax Resource (Windstar FNTR) system, a web-based tax return preparation system designed exclusively for international students, scholars and their dependents, should help you determine your tax residence status.
Nonresidents (for tax purposes) are taxed only on their U.S. income and usually complete Forms 1040NR or 1040NR-EZ. While nonresidents are not required to file a federal or state tax return if their earned income amount is below the stated personal exemption amount, they are encouraged to file a return if taxes were withheld from their pay check as they will likely receive a refund.
In addition, all individuals in F-1 and J-1 immigration status (including F-2 and J-2 dependents) filing as nonresidents for tax purposes are required to file a Form 8843 – Statement for Exempt Individuals. Filing this form does not mean you are exempt from taxes, but rather that you are exempt from counting days of physical presence in the U.S. to determine if you are to be taxed as a resident or a nonresident. Keep in mind that even if you have not earned any income, you are still required to complete and submit the Form 8843. This form requires information about immigration status and tax treaty claims. For additional information regarding completing Form 8843, please consult the Windstar FNTR content library.
During the time individuals in F-1 and J-1 immigration status are “exempt individuals,” they will remain nonresidents for tax purposes even though they are present in the United States for 183 days or more. Once they exceed “exempt individual” status, days of physical presence will be counted and they may become residents for tax purposes.
If you qualify to file as a nonresident, it is likely that Windstar FNTR will be able to help you prepare all of your tax forms.
Residents (for tax purposes) are taxed by the U.S. on their worldwide income and generally complete the Form 1040-EZ or the 1040 and required schedule forms. Some examples of a resident for tax purposes are:
– F and J students (and their dependents) who no longer qualify as “exempt individuals” as they have been physically present in the U.S. over five tax years
– J scholars (and their dependents) who no longer qualify as “exempt individuals” as they have been physically present in the U.S. for more than two out of every six tax years
– foreign nationals in any other immigration classification who are physically present in the U.S. for 183 days or more in any three year period
While Windstar FNTR will be able to offer you detailed information about your tax status and filing obligations as a resident for tax purposes in their content library, Windstar FNTR will likely not be able to assist you in preparing your actual tax forms.
Dual Status Aliens are nonresidents for tax purposes for part of the year and residents for tax purposes for the rest of the year.
A change in immigration status may affect an individual’s resident status changing them from a nonresident (for tax purposes) to a resident (for tax purposes).
While Windstar FNTR will be able to offer you detailed information about your tax status and filing obligations as a dual status alien in their content library, Windstar FNTR will likely not be able to assist you in preparing your actual tax forms.
What documentation do I need to collect before I begin?
If you earned or received income in the U.S., you are required to gather official documentation from various sources in order to complete the tax forms. Sources of U.S. income may include on-campus employment, scholarships, fellowships, graduate assistantships, stipends, practical or academic training, and any compensation received for labor. “Income” is not limited to wages paid to the individual in cash, but also includes that portion of a scholarship, fellowship, or assistantship that is applied to housing and meal expenses. Some examples of this official documentation are a Form W-2 from your employer, Form 1042-S from Boston University and/or another academic institution you attended in 2010, Form 1099 from your bank or any other forms showing income.
Form W-2
Students and scholars who received taxable income during 2010 from Boston University should have already received a Form W-2 which shows the wages you earned and taxes Boston University withheld. The W-2 forms were mailed by the Office of Payroll on January 31, 2011. If you have any questions regarding your Form W-2, please contact the Boston University Office of Payroll directly at 617-353-2270.
Form 1042-S
Students who received a scholarship or fellowship from Boston University or students who are claiming a tax treaty in 2010 should have received a Form 1042-S from the BU Payroll Office which shows the amounts paid to foreign students, trainees, teachers and researchers. In addition, students who have claimed a tax treaty exemption for their wages or stipends should have recieved a Form 1042-S which shows the federal wages covered by the tax treaty. You will not be able to begin completing your tax forms until after you have received the form. If you have any questions regarding your Form 1042-S, please contact the Boston University Office of Payroll directly.
How do I get started on completing my tax return?
In order to facilitate the filing of your federal tax returns, the ISSO has purchased licenses to Windstar’s Foreign National Tax Resource (Windstar FNTR), an online system for completing tax forms. Please note that the Windstar FNTR access code you will need to create your individual Windstar FNTR login will be sent to you in a private email from the ISSO. Please contact the ISSO (isso@bu.edu) if you do not receive the instructional email.
Windstar FNTR will assist most international students and scholars with the preparation of their tax forms. However, there may be circumstances in which individuals will not be able to use Windstar FNTR. Consulting the information on theWindstar FNTR site and entering basic information into the system will help determine if you are eligible to use Windstar FNTR.
Please note that Windstar FNTR will help you to calculate your Massachusetts tax and will allow you print a “pro-forma” tax return. However, you will be required to transcribe the data from the pro-forma return to an actual Massachusetts tax form before signing it and submitting the MA form through the mail. Click here to find the Massachusetts form.
Can I hire someone to prepare my tax forms for me?
Absolutely! Students and scholars who have more complicated tax cases or simply want assistance in completing their tax forms can pay a tax service provider or a tax consultant.
Tax service providers
There are many tax service providers who market to individuals who need help completing their tax forms. If you decide to use a tax provider to help complete your forms, make sure to ask if they have foreign national tax expertise. If they do not, then you should find another provider. Also, make sure to ask if they will give you a discount as a student or scholar of Boston University.
Tax consultants and tax attorneys
You also have the option of hiring a lawyer to assist you in reporting your taxes and to file your forms. A listing can be found in a phone directory or at http://www.superpages.com under a category such as “tax returns, consultants, & representatives.” If you choose to hire a private agency or lawyer, we strongly recommend that you make certain they specialize in tax issues unique to foreign nationals.
CINTAX Tax Preparation Software
If you have used the CINTAX tax preparation software provided by the ISSO in past years for nonresident tax forms and prefer to continue using this product, you can purchase an individual license for $39 at https://www.arcticintl.com/quick-spt-b.asp.
What do I do if I don’t have a Social Security Number?
Students who have earned income should have a Social Security Number. If you do not have a Social Security Number, you can apply for an Individual Taxpayer Identification Number (ITIN) the first time you submit a tax form, or you should file this year’s tax form with the ITIN if one was assigned to you in the past. Windstar FNTR will help you apply for an ITIN along with your tax return if you do not already have one. Please visit the following ISSO web page regarding how to apply for a Social Security Number.
Where can I obtain the forms directly if I do not use Windstar FNTR?
You can prepare tax forms on your own by downloading the forms at the following links:
- Federal tax forms
- Massachusetts state tax forms
- Tax forms for other states
Where can I get more information?
There are a number of resources available specifically for international students and scholars to assist them in understanding their tax obligations and to help in filing tax forms.
Foreign Student & Scholar information
This site is a clearinghouse of various topics that relate to foreign student and scholar tax issues and ITIN issues.
Three links on the Student’s page of the IRS Website may be of particular interest:
- Link & Learn – This is a good training tool and includes case studies and quizzes (takes approximately 2-4 hours to go through thoroughly).
- International Taxpayer – Provides links to other resources on the IRS Web site.
- Non-Resident Alien Toolkit – This is a publication with a PDF Slide show and FAQs.
Can I talk to someone?
Federal tax returns: You can visit the Boston Office of the IRS from 8:30 am to 4:30 pm Monday through Friday at the John F. Kennedy (JFK) Federal Building in Government Center on the 7th floor. This office can be reached by telephone at (617) 316-2850 or via their website at: http://www.irs.gov/localcontacts/article/0,,id=98286,00.html
Massachusetts State Forms: You can telephone the Boston Office of the Massachusetts Department of Revenue (DOR), at (617) 887-6367 from 10 am – 1 pm and 1:30 pm – 4 pm.
Publications
The following publications may also be helpful.
U.S. Tax Guide for Aliens
U.S. Tax Treaty Tables and descriptions
Withholding of Tax on Nonresident Aliens and Foreign Corporations
Disclaimer
Information presented on this web page is for general information and is not intended to be, nor should it be construed as, legal tax advice. While the ISSO has arranged for the services of Windstar FNTR, international students and scholars can choose how they wish to complete and submit tax forms as it is the individual’s sole responsibility to meet all tax filing obligations. International students and scholars are encouraged to follow Windstar FNTR instructions to prepare federal forms online and/or consult the U.S. Internal Revenue Service (IRS), local and state tax agencies and tax professionals for advice and guidance regarding their individual tax situations.
National Postdoctoral Association Instruction to free affiliate NPA membership
Free Online Lab Management Software
www.bls.gov/home.htm This Website offers you the most current federal statistics regarding an occupation’s nature of the work, training and qualifications, employment outlook, projected earnings and much more. Simply enter an occupation in the Search BLS.gov Box at the top right of the screen to learn more.
www.onetonline.org/find/ Is also an outstanding source for occupational profiles. You may search this database using the official job code associated with your program of study.
Internal Revenue Service Resources The IRS Website offers form, explanations, and resources to help with all federal tax information.