Written by: Triveni Raghavan
âWe are from Brazil, Canada, China, India, Japan, Kazakhstan, Netherlands, UK, Vietnam and many other countries. We are students, scholars, postdocs and spouses. What unites us all is Taxes.â This is not a Tom Lehrer song, but about the last workshop of the Fall 2014 CLG Series, presented by Dr. Li-Chen Chin of IHouse.
Taxes are ubiquitous. So, the workshop began with a discussion among participants about taxation in their home country. Dr. Chin started the presentation by explaining about the taxes that we pay â sales tax, property tax, income tax and the governing structures. Then we plunged headlong into the main topic of discussion for the evening, Income tax.
The first step is to understand the difference between immigration status (F, J or H) and residency status (Resident or Non-Resident) for tax purposes. In the US, the Social Security Number or Individual Taxpayer Identification Number determines your identity. Therefore, it is very important not to share it with anyone unless it is deemed necessary. Sources of income that are taxable are wages, scholarship/fellowship that covers your living expenses, awards & prizes, while tuition scholarship that does not cover local expenses and bank interest are not taxable.
We have to file separate tax returns for federal and state taxes. The forms for federal returns for Non-residents are:
- Form 8843 - If you had no taxable income
- Forms 1040 NR / 1040 NR-EZ & 8843 â If you had taxable income
Confident that we had understood the basics, we bravely tackled some word problems about federal tax forms. If you are from one of those countries with which US has signed a tax treaty, you may get some tax benefits or exemptions. But it is important to file the paperwork in order to get these benefits. If you are not sure about this, you can get information from Duke Corporate Payroll Service.
Now, letâs look at to the state tax forms. In North Carolina, you have to file a tax return if your federal gross income exceeds $5,500 or if you believe, you are eligible for a tax refund from the state.
If you feel that income tax is the hardest thing in the world to understand, donât worry, Einstein is said to have felt the same wayâº. But, you have enough time to figure this out. For income earned in 2014, the due date for filing tax returns is April 15, 2015. You can get all this information and more at IHouse.
And finally, kudos to IHouse for their grand efforts in stimulating us to Connect, Learn, Grow.