If you will be paid at your internship/training program, U.S. law requires that you pay federal, state, and local taxes. As an income-earning individual, you will be taxed on income from your salary or stipend. Your employer will submit the amount withheld from each paycheck 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 vary, but they are typically less than state and federal taxes. If no taxes are withheld from your paycheck, please contact InterExchange.
|You Do Pay:||You Do Not Pay:|
|Federal Income Tax||Medicare Tax (FICA)|
|Local or City Income||Social Security Tax (S.S.)|
|State Income Tax||Federal Unemployment Tax (FUTA)|
If you see deductions that say FICA, FUTA, S.S., or Social Security, please notify your employer promptly. If your employer is unable to issue a refund, contact the Internal Revenue Service - the U.S. government agency that collects taxes - and request IRS Form 843, Claim for Refund and Request for Abatement. You will need to submit the completed IRS forms to the Internal Revenue Service Center. Please note: Some states may deduct state unemployment taxes, which you are required to pay.
Please note that the 2018 Tax Cuts and Jobs Act (TCJA) includes changes to the federal income tax law that may affect some exchange visitors. The new federal income tax law, which will be implemented in 2019, eliminates the personal exemption of $4,050 when filing Form 1040-NR for nonresident aliens. This may affect exchange visitors’ refund of wages withheld for federal income tax and may consequently increase the cost of Exchange Visitor Program participation.
When you arrive at your host employer, you must complete an I-9 Employment Eligibility Verification Form, which informs the federal government that you are permitted to work in the United States. You will need to show your passport, a printout of your I-94 Arrival/Departure Record, J-1 Visa, and DS-2019 Form to your employer when completing this form. You will complete Section 1, and your host employer will complete Section 2. You should fill out Section 1 using your host employer’s address.
Form W-4 and What You Should Pay
For tax purposes, you are required to fill out a W-4 Employee Withholding Allowance Certificate as soon as you start working. Your employer will give you a W-4 Form. It is your responsibility to complete and submit the W-4 Form to your employer. Based on the information you provide, your employer calculates the amount of federal, state, and local taxes that will be withheld from your paycheck.
Note: You should only pay income taxes. You are not required to pay Social Security, Medicare or unemployment taxes. If your employer has withheld these taxes from your paycheck, please advise her/him of the mistake and request a refund. To verify that the proper taxes are being withheld from your paycheck, you should review your pay stub (the wage breakdown that come with your check).
How to Fill Out Your 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 only. As a non-resident, 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 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.
Your W-2 Form
As an exchange visitor on a J-1 Visa, you are considered a non-resident alien for tax purposes. Depending on the length of your internship and your salary, you may be eligible for a refund of much of the taxes you paid. By January 31, your employer must send you a W-2 Form (your employer is required by law to mail your W-2 to you by February 15). If you finish your program before February of next year, you should give your employer a self-addressed envelope with your home country address so that he or she can mail you your tax forms later. Be sure to file a tax return to get your money back! Please note that InterExchange staff are not tax professionals. If you have specific tax questions, please consult a tax professional.
Note: Participants whose program dates span two different years will receive two W-2 Forms. For example, if your internship/training program lasts from September 2017 to April 2018, you will receive a W-2 in February 2018 for wages earned in 2017, then another W-2 will be sent to you in your home country in February 2019 for wages earned in 2018. You will need to file taxes for each calendar year you worked in the United States.
Filing a Tax Return
How to File Your Taxes and Form 1040NR-EZ
2018 filing dates: Your host employer must legally issue your W-2 form by January 31, 2018 (if they are mailing it, your form must be mailed by this day, but you may receive it later). You will need this form to file your tax return. If you do not receive this form from your employer by mid-February or March, contact your employer immediately. Your tax return must be filed by April 17, 2018. (Hint: The sooner you file, the sooner you can receive your tax refund!)
Where to send your form: 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 U.S. Embassy in your home country or on the IRS website. Once you have completed the form, you may send it to the IRS branch in the state in which you lived.
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 U.S. 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. The paperwork for your 2017 taxes must be postmarked and mailed on or before April 17, 2018. Please look at a sample 1040NR-EZ Form. There are separate forms for state and local taxes, but they vary by state. You must request these state and local forms from your employer. They are not available at the embassy. The IRS website has more information on filing for taxes in your host state.
Tax status: For tax purposes J-1 Visa holders are considered non-resident aliens. Please review the IRS' non-resident alien filing requirements.
Tax Treaties: Some countries have agreements with the U.S. government that affect the tax rate that their nationals must pay. If your country has a tax treaty with the U.S., you should indicate this when you file your taxes to get the adjusted tax rate.
J-2 Taxes: J-2 visa holders must also file taxes if they are over 18 or have earned money while in the United States. If they have not earned any money, but are over 18, they should file Form 8843.
Additional Tax Resources
InterExchange is not a licensed tax preparer; if you have specific questions, we advise contacting the IRS directly. You may also contact a tax provider who could assist you with your individual situation, typically for a flat fee or a percentage of your tax refund. Make sure you tell them beforehand that you are a J-1 Intern/Trainee (non-resident alien) and be mindful of any fees they may charge. You are also encouraged to use the following resources as you plan to file your taxes: