If you are doing a paid internship or training program, you will be required to pay taxes to the U.S. government.
When you arrive at your host company, you must complete an I-9 Employment Eligibility Verification Form, which notifies the federal government that you are allowed to work in the United States. You need to show your passport, I-94 printout or card, J-1 Visa, and DS-2019 Form to your employer when completing this form. You are only required to fill out Section 1. Your employer will complete Section 2. Remember to fill out Section 1 using your U.S. work address.
For tax purposes, you are required to fill out a W-4 Employee Withholding Allowance Certificate as soon as you start your internship/training program. Based on the information you provide on the W-4 Form, your employer will calculate the amount of federal, state, and local taxes that will be withheld from your paycheck.
U.S. law requires that you pay federal, state, and local taxes. Your employer will deduct money from your paycheck every pay period. As an income-earning individual, you will be taxed on income from salaries, wages, and tips. Your employer will submit the amount withheld directly to the federal government. Deductions for state and local taxes will vary. Some states do not have a personal income tax; others may tax income as much as 8%. Similarly, local taxes will vary, but will be lower than state taxes.
You should only pay income taxes. You do not have to pay Social Security, Medicare or federal unemployment taxes (Please note: Some states may deduct state unemployment taxes, which you are required to pay). If your employer has withheld these taxes from your paycheck, please advise him/her of the mistake and request a refund.
To verify that the proper taxes are being withheld from your paycheck, you should review your wage details in your paycheck. If you see deductions that say FICA, FUTA, S.S. or Social Security, please notify your employer promptly.
How to Complete the W-4 Form
- Your employer may tell you to follow the instructions printed on the form, but this is not correct. The instructions on the W-4 Form are for U.S. residents, not exchange visitors. Please follow the instructions below.
- Do not complete the Personal Allowances Worksheet; this does not apply to exchange visitors.
- Home address: Indicate your permanent U.S. mailing address.
- Box 2: Enter your Social Security number if you already have it. If you do not have your number yet, inform human resources at your host company that you have applied for a number and provide a copy of your receipt.
- Box 3: Mark or check Single, even if you are married.
- Box 4: Leave blank.
- Box 5: Write "1." If you are a resident of Canada, Mexico, Japan, or South Korea, or a U.S. national, please visit the IRS website for instructions.
- Box 6: Write NRA for “Non-Resident Alien.”
- Box 7: Leave blank.
- Sign and date your form.
- Box 8-10: Leave blank.
As an exchange visitor on a J-1 Visa, you are considered a non-resident alien for tax purposes, and you are required to pay some taxes. Filling out your W-4 Form properly will ensure that you do not owe the U.S. government any money because the taxes will be taken out of each paycheck. Depending on how long you work and how much money you make, you may be eligible for a refund of some of the taxes paid. If you are eligible, you must file a tax return to get this money back.
All program participants who are paid must file a U.S. tax return for the previous calendar year by April 15. Even if you are no longer in the U.S., you still must file your U.S. tax return. Your tax return should show your earnings for the previous year, the taxes you paid, and the total amount of taxes owed or refunded. To file your tax return, you will need a W-2 Form from your host employer.
At the beginning of the calendar year, your employer will send you a W-2 Form, which summarizes your earnings and taxes withheld from your paycheck during the previous year. Employers have until February 15 to mail W-2s to all of their employees. If you do not receive a W-2 form by the end of February, please contact your host company and make arrangements to have your W-2 sent to you. We recommend that before you return home you give your employer a self-addressed envelope with your home country address so that they can mail you your tax forms.
Upon receiving your W-2 Form, you will fill out a 1040NR-EZ (Non-Resident Aliens with No Dependents) Tax Form. You can obtain this form at the United States Embassy in your home country or on the IRS website.
The U.S. government agency that collects taxes is the Internal Revenue Service. You can get forms, instructions and information from their website.
Once you have completed the form, you should mail the form to the appropriate address listed in the tax filing instructions instructions.
When you request the 1040NR-EZ Form, make sure to ask for the instructions pamphlet. To avoid any mistakes, follow the instructions carefully. If you overpaid the government, they will issue you a check. However, if you did not pay enough taxes, you must pay the government the amount you still owe. Your tax paperwork must be received by the IRS on or before April 15 of the year following the year when you earned the wages. There are separate forms for state and local taxes. You must request these state and local forms from your employer. They are not available at the embassy.
Please note that InterExchange staff are not tax professionals. You must contact the IRS if you have any specific questions regarding your tax return.
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