TAX TREATIES

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					 TAX TREATIES


Sara Marcotte
Accountant
Accounting Services
 UNITED STATES INCOME TAX

A tax that the government imposes on
 income earned by individuals.

 Income  tax is a key source of funds that
 the U.S. government uses to fund its
 activities and serve the public.

 Income   tax is “withheld” from wages.

 Canbe referred to as “federal
 withholdings”
     WHAT IS A TAX TREATY?
 Formal written agreement between
 countries

 U.S.has tax treaties with a number
 of countries

 Residents of foreign countries are
 taxed at a reduced income tax rate or
 exempt from U.S. taxes on certain
 types of income
  TAX TREATIES -CONTINUED
 Not   all countries have tax treaties

 Notall tax treaties are the same.
 Each country has their own
 “agreement” with the United States.
     TAX TREATIES & STUDENT
             WAGES
 Some countries have tax treaties with
  the United States that exempt student
  wages from income tax.

 Certain  conditions need to be met in
  order for student wages to be exempt:
  1) Length of time in the United States
  2) Amount of Earnings

http://www.admin.mtu.edu/acct/dept/tax/nrstudentwages.htm
                       FORM 8233
 Qualify       for tax treaty? Fill out form
    8233

 Form    8233 is a form that exempts your
    wages from income tax. There will be
    no “withholdings” from the wages you
    earn.

 Must       be filled out annually.
   http://www.admin.mtu.edu/acct/dept/tax/8233info.htm
      WHAT IF 8233 IS NOT
        COMPLETED?



 When  you file tax return at the end
 of the year – you can be refunded the
 income tax that was “withheld”.
       HELPFUL WEBSITES
Tax Treaties:
 http://www.irs.gov/businesses/internati
 onal/article/0,,id=96739,00.html

Summary of Tax Treaties:
http://www.irs.gov/pub/irs-pdf/p901.pdf

Student Wages & Form 8233:
http://www.admin.mtu.edu/acct/dept/tax/
 nrstudentwages.htm
QUESTIONS?

   SEE ME!

  Sara Marcotte
sjmarcot@mtu.edu
    487-2449