International Student Tax Return Guide: Policies & Rules

In student life managing taxes and finances while living abroad as a student is a daunting task right? Learning about international student tax returns, collecting documents, and actually filling them out online must be hard. Don't worry! We've got you covered! Let's dive into the tax return guide for international students and save a little more in your pockets. 

Further, learn about types of taxes, qualifications, important pointers to keep in mind, and other determining factors regarding foreign student taxes. As you head towards your study abroad journey, you must stay ahead in managing your finances. 

An international student tax return is an amount returned to you after taxes are deducted from your income or side hustle. The government will pay you a specific amount based on various treaties, eligibility requirements, and other factors influencing your visa.

For Example, F-1 or J-1 visa holders are eligible to file and get student tax returns even if they are not working professionals in the USA. As an international student, You need to list your income and deductions, check balance and eligibility for tax returns.

Why File an International Student Tax Return?

You must file international students' tax returns not to show the government the finances they owe but their sources of income. It is an opportunity for you to get any exemptions and deductions that you may qualify for. You can claim those exemptions and deductions by either hiring a tax professional or getting help from your university.

How to File an International Student Tax Return?

In order to file an International student tax return, you must have the right set of documents just like a guide to council tax exemption for students.  You can go through the ways to file international students tax given below.

1. You can collaborate with a tax expert who can identify the appropriate documentation for your profile. They will assist you in completing the paperwork or complete it for you. Then, they will deliver it to the government IRS on your behalf. 
2. You still have options for getting assistance with international student tax returns. 
3. You can seek assistance from your university and file your tax return online. 
4. The IRS offers helpful resources and thorough guidelines on its webpage to streamline the student tax return procedure. 
5. You must decide which forms you require for tax returns and then complete them. After that, you can mail them to the IRS before the mid-April deadline. 

Types of Forms for International Student Tax Returns?

You need to file various forms for international student tax returns. Tax returns for international students are categorized  based on their visas. We have mentioned a brief description of these forms below. 

1. Form 1098-T

Form 1098-T (Tuition Statement) is an IRS tax document that qualified educational institutions must submit to disclose payments. The payments must be made by you and the payments that you owe to the university. Universities submit forms to the government for international students.

Eligibility

1. You must have a bachelor's or master's form the country you are applying to and have proof of finances to pay your tuition fees.
2. You should also be able to pay other costs along with the tuition fees during the course.

Qualified Educational Expenses

1. University Fees
2. Course Materials Costs

Not Applicable

1. You are not eligible if you pursued a course that is not eligible for academic credits despite the status.
2. You are a nonresident of the country.
3. You are not eligible if your tuition fees are completely waived off or 50% by the university.
4. You are a scholar at the university. 
5. A third party, like defense or veteran affairs, pays your tuition fees.

2. Form 8843

The IRS uses Form 8843 [Substantial Presence Test (SPT)] as a physical presence test to evaluate whether you have been a citizen or lawful permanent resident if you stayed for 183 days during three years. You must qualify as a "resident for tax purposes" or a "non-resident for tax purposes" to fill the form. If you will receive permanent residency based on the SPT test after your studies then you qualify for Form 8843 or Substantial Presence Test.

Eligibility

1. You must be present for at least 31 days in the country before filling out your student tax return.
2. To qualify for student tax returns, you must reside in the country for 183 days at least in the span of three years. Further, you must have resided for 31 days in the span of a tax year. 
3. You must have non-exempt status in the United States for more than six months to qualify for SPT. Non-exempt status in the United States consists of workers who are entitled to earn minimum federal wage and qualify for overtime pay.

3. Form 1040-NR

Form 1040, also known as the U.S. Individual Income Tax Return, is a tax form used to file individual or federal income tax returns. Your form will consist of the taxpayer's total taxable income and establish the amount that will be refunded or paid by the government.

Eligibility

1. You are a resident or an alien resident in the country. 
2. You have passed the Substantial Presence Test.
3. Your income is less than $66,000 in the country.

4. Form 1042-S

If you are not a green card or non-resident then, you must file a 1042-S form. This form states payments covered by IRS tax forms 1042-S and 1042. The university provides it, and students must fill it out if you receive a taxable scholarship.

Eligibility

1. You must have nonresident alien status and be an international student or scholar.
2. You must be studying at one of the recognized universities in the country.

Documents Required for International Student Tax Returns

You must possess a set of valid documents to file your international student's tax return. You will require wage and tax statements, social security numbers or ITIN, and more to file a tax return. We have listed down the required set of documents below. 

1. W-2 form
2. Social Security or ITIN number
3. 1042-S form
4. Passport
5. Visa Status Document
6. Country entry and exit dates details. 

Things to Keep in Mind for International Student Tax Returns

There are certain determining factors you must keep in mind when you apply for a foreign student tax return. You must be studying to file a tax return for international students. 

• You must fall under a certain slab or category of the government to get international students' tax returns. 
• You must have an Individual Taxable Identification Number (ITIN) to file your student tax return. 
• You must have your W-2 form stating your employment status with the employer before February of the following tax year. 
• You have a valid F, J, or HB-1 visa to study in the USA or a valid student visa to study in other countries.

Foreign students tax return is an additional benefit to your finances. Knowing how to pay tuition fees as an international student can reduce some weight from your soldiers. It not only increases the weight in your pockets but also allows you to enjoy several benefits. The tax returns for international students vary from one country to another. 

Therefore, you must get help from an international student tax returns expert or your university to understand the tax return rules and regulations for your country. Further, you can visit the government website and collect insights about foreign student tax returns. Form 1098-T, Form 8843, and Form 1040-NR are some of the forms that you must fill out and submit in the ITR. 

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