Residents for Tax Purposes
A Resident for Tax Purposes (RA) is subject to U.S. income tax on worldwide income (like a U.S. citizen).
A person is determined to be a resident for tax purposes based on the Substantial Presence Test (SPT). For example, an individual in F-1 status who is in the US in their 6th calendar year, or an individual in J-1 status in their 3rd calendar year can be considered to be an RA. You must determine if you were a RA for the full calendar year. The tax return you file depends on your tax residency status on December 31st of the year for which you are filing. Please contact Devon Slough if you are unsure of your residency start and change dates.
Tax Filing Obligations:
- Individuals who are RAs for the full calendar year submit a federal income tax return using the same rules as U.S. citizens -- filing a Form 1040 EZ or Form 1040.
- RAs with a taxable (non-qualified) scholarship or fellowship grant should record the amount on the Form 1040 EZ on the line for "wages, salaries, tips, etc." indicating SCH (for scholarship) on the dotted line. A schedule (breakdown) listing the calculation of the taxable portion of the scholarship should be attached to the tax returns. OIT can help with creating this schedule.
- RAs with a scholarship should also request a 1098-T from the Bursar's Office. The 1098-T lists qualified scholarship amounts to be used by U.S. citizens and RAs in support of the Hope and Lifetime Learning Credits. The tuition tax credits may help to reduce down the amount owed in taxes on the scholarship. Include the 1098-T as part of the tax return.
- RAs with treaty-exempt grants or treaty-exempt personal service income (wages) must follow the instructions in IRS Publication 519 for such claims.
- RAs do not file Form 8843
