1985 Income Tax Return Form - PowerPoint

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1985 Income Tax Return Form - PowerPoint Powered By Docstoc
					TAXES AND THE INTERNATIONAL STUDENT
TAXES AND THE INTERNATIONAL
STUDENT

 This workshop is for students on F-1 who have
  been in the U.S. for 5 years or less.
 The information provided in this tax workshop
  is intended only to give you a general sense of
  taxpaying requirements and may not be relied
  upon in preparing your individual tax return.
  Specific instructions are provided by Internal
  Revenue Service (IRS) or state and local
  agencies.
WHEN ARE TAXES DUE?

 April 15th
 June 15th if filing a tax return from outside the
  US.
 Individuals who need to file only the Form 8843
  because they had no income are also given
  until June 15 to submit their form.
TYPES OF TAXES

1.   Personal Property Tax (supports local roads and
     schools and is primarily a tax on ownership of a
     car). Non-residents are not exempt from this tax.
2.   Social Security and Medicare taxes (together
     called FICA).these taxes support US retirees and
     the disabled. Nonresidents in the F categories
     are exempt from these taxes during the time they
     are “non-resident aliens” for tax purposes if they
     are in valid immigration status.
TYPES OF TAXES

3.   City/Local Income Tax is generally required in
     larger metropolitan areas, i.e. New York City.
4.   State Income Tax. Individuals living in certain
     states are required to file. NYS is one. Some
     states allow tax treaty exemptions similar to
     those available at the federal level; others do
     not. It is the responsibility of the individual
     taxpayer to follow the rules of the state that
     they live in.
5.   Federal Income Tax.
WHAT IS A TAX RETURN?

   In the US, federal income taxes are prepaid by
    our employer based on the estimate of liability
    provided by the employee on the Form W-4,
    usually filled out at time of hire. Since the
    amount taken out is only an estimate,
    employees are given a yearly opportunity to
    reconcile the amount taken out with how much
    was owed. This is a tax return.
WHAT IS A TAX RETURN?

   In some cases, filing the tax return results in a
    refund from the IRS because the withholding
    was higher than necessary. However,
    sometimes a taxpayer does not have enough
    withheld and must pay the IRS.
TAX VOCABULARY
 Alien: generally, any person who is not a U.S.
  citizen
 Student: person temporarily in the U.S. on an F, J,
  Q or M visa
 Compensation/Earnings: wages, salaries, tips
 Income: wages, salaries, tips, interest, dividends,
  some scholarship/fellowship grants
 Withholding: U.S. income tax automatically taken
  from your paycheck
 IRS: Internal Revenue Service
 Income Tax Return: statement filed (submitted) by
  individual taxpayer to the IRS
WHO MUST FILE A TAX RETURN?
•   All individuals in the US who have income must file
    a US tax return.
    –   Tax residents file a 1040, 1040A or 1040-EZ.
    –   Nonresidents for tax purposes must complete either a
        1040NR-EZ or a 1040-NR.

•   A tax return must be filed even if no taxes are
    withheld from the income because of a tax treaty
    exemption between the US and the country of tax
    residence for the international visitor.
WHO MUST FILE A TAX RETURN?
•   In addition to a tax return, all individuals in the “F”
    immigration status who are “exempt individuals”
    (including spouse and young children) are required to
    file a Form 8843 – Statement for Exempt Individuals.
    –     Filing this form does NOT mean the person is exempt
        from taxes, but rather that he or she is exempt form
        counting days of presence in the US to determine if he or
        she is to be taxed as a resident or a non resident.
    –   This form asks for certain information about immigration
        status and tax treaty claims. Therefore, if a nonresident
        alien has no income in the US but is still within the
        “exempt individual” period, he or she must file the Form
        8843.
WHAT IS “NON-RESIDENT” ALIEN?
•   Warning – Two primary US government agencies us the
    terms “Non-resident” and “Resident Alien,” but define
    them differently. This can lead to confusion.
    1.   US Immigration (USCIS) defines a nonresident alien as
         someone in the US who is not a US citizen or US
         permanent resident, who has a residence abroad he or
         she does not intend to abandon.
    2.   IRS – Residents are all US citizens, lawful permanent
         residents and non resident aliens for immigration
         purposes who have met the Substantial Presence Test.
         Nonresident aliens are all others, regardless of
         immigration status
DETERMINING TAX RESIDENCY

•   Substantial Presence Test – one must be
    present in the US for a total of 183 days,
    counted over a period of three years.
•   Those in “F” do not count days during the time
    they are “exempt individuals.” “F” students and
    their dependents are “exempt individuals” for a
    period of five years throughout their lifetime
    (going back as far as January 1, 1985).
“EXEMPT INDIVIDUALS”

•   Remember “exempt individuals” means exempt
    from counting days of physical presence toward
    the substantial presence test, not exempt from
    paying taxes.
•   During the time individuals are exempt, they
    cannot pass the 183 day SPT and will remain
    nonresidents for tax purposes even though they
    are present in the US for more than 183 days.
FORM 8843
FORM 8843 CONT.
WHAT IF YOU DO NOT EARN AN INCOME?

    You do not have to pay taxes, but you must
     send a form 8843 to the IRS.
FORM W-2 AND FORM 1042-S

 You could have one or more from different
  employers.
 The form was prepared by your employer and
  mailed to you.
 You do not write anything on this form.

 You use this form as a reference when you
  prepare your income tax return.
 You use this form as a reference when you
  prepare your income tax return.
                                  FORM W-2

                    16-6000000               6000.00   540.00


 State University
 345 University St
 Collegetown, NY 00000

                    010-00-0101


 Joy Kim
 123 University Lane
 CollegeTown, NY 00000




NY 16-6000000            6000.00    240.00
              Form 1042 – S
Normally used to report income covered by a tax treaty
FORM 1040NR-EZ OR 1040NR

                 New for 2006

You do not need to file a form 1040-NR if:
1. You have only taxable U.S. Source Wages that
   were less than $3,300; and
2. You have no other need to file to claim a
   refund of over-withheld taxes.
TAX TREATIES

 Many countries have Tax Treaties with the U.S
  that allow their residents to earn some money
  while temporarily in the U.S. without being
  subject to income tax on those earnings.
 Tax treaties may effect who can be claimed
  (dependents and spouses).
 Examples are South Korea, India and Canada

 See IRS Publication 901 for details.
WHERE DO I FILE


                New for 2006:

Internal Revenue Service
Austin, Texas 73301-0215, U.S.A
HOW LONG DO I HAVE TO KEEP MY
RECORDS?


    Officially, seven (7) years.
WHERE CAN I GET HELP
   VITA on Campus beginning in March
   Internal Revenue Service http://www.irs.gov
   IRS International Customer Service:
    (215) 516-2000
 IRS Toll Free Number – 1-800-829-1040
 US Tax Guide for Aliens
  http://www.irs.gov/pub/irs-pfd/p519.pdf
 US Tax Treaties http://www.irs.gov/pub/irs-
  pfd/p901.pfd
THANK YOU FOR COMING!

				
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Description: 1985 Income Tax Return Form document sample