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Tax return for students in USA

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Etats-Unis

L'actualités des groupes

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18/03/2015

This article is only for students who are on the F1 visa (so most of the Centraliens who are going to USA). It is not a tax "course" but just a guide for those who feel lost!

In USA, taxes are withdrawn directly on the salary and once a year, we have to fill a tax return form to get reimbursed in cases we paid too much taxes.

To understand tax, you need to know the following terms:
*W-4: Tax document that is filled at the beginning of the semester in the department. You will claim allowances (i.e. "reductions"). 0 means you will pay the maximum of tax each month, 1 means a little bit less, 2 even less. Since we are F1 visa, we can claim either 0 or 1. It's better to claim 1 so your net salary will be higher.
*W-2: Tax document for all students that have a TA/RA position. It shows all your taxable incomes. It is provided (online usually) once a year before filling tax return.
*1042-S: Tax document for all students that comes from France (but also Europe, Tunisia, Morocco...) and all the countries that have a tax treaty. It shows all your incomes that are not taxable.
*GLACIER: Online software to fill the tax return for F1 visas students. Because in USA, taxes is a business and different companies want to sell you a software to fill the tax forms.

Deadline for tax return is usually April 15. We are all required to fill it.

Step 1: Fill the W-4 i your department and claim 1 allowance (best decision).

Step 2: Get your employment authorization form, social security number.

Step 3: Around October, you will got an email from GLACIER asking you to create a profile on their website online-tax.net. You will be asked if you want to claim your tax treaty (do it and return the form at the administration office as explained on the GLACIER website). For most of you, by claiming the tax treaty you will not pay tax on the first $5000 of each fiscal year! (or $4000 depending where you come from).

Step 4: Around January, you will get an email from GLACIER saying that your form 1042S is ready to download. You might receive a paper version of the 1042S from your school. Just save this document. If you didn't claim the tax treaty, you will not have any 1042S.

Step 5: Around February, you will get another email from GLACIER asking you to fill a tax return. Just go to the website and answer the question. You will need your W2 form, 1042S. At the end, GLACIER will tell you if you have to pay or receive money from the tax office. In both case, you need to print out the form and mail them to the provided address. Deadline to send the document is around April 15.

Note 1: Since we are non-resident, we need to fill the 1040NR (as Non-Resident) form. Don't use commercial software as TurboTax (it is for resident and illegal for us to use them, to get a H1 visa, your tax history is checked and if you cheated, you will have to reimburse...+penalties). Never fill the 1040 form (it should be 1040NR).

Note 2: Don't compare your tax return amount with Americans, Mexicans, Canadians, Coreans, Indians or people in the States for more than 5 years because all of them are considered as resident and should get at least $1000 while you should get around $200 (if you are TA/RA with $2000 salary). They will get much more (the reason is that you will get a tax credit on $3000 of taxable income instead of $9000 for resident...)

Note 3: GLACIER is a basic software to fill tax return for non resident, there are additional deductions you can make by filling the forms by yourself or with a tax professional (but it's pretty easy by following the lines of the form 1040NR):
** If you had to move out because of your job (let's say transfer to another university) you can use the form 3903 for pretty good deductions. Moving from France to USA can't be deducted. Keep all receipts. 
** If you had to attend a conference AND that you had topay yourself for it, you can fill the form 2106 for business expenses. Especially if you had to drive yourself. Keep all receipts. Do it only if your total expense is at least 2% of your taxable income (line 1 from your W-2) because only the amount over this 2% can be deducted and its effect will be small. For instance, I had $120 business expenses over this 2% and I got only $12 of tax reduction...




 
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