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What's
New for Tax Year 2007
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An important item of note is to remind readers of
the criteria that determines who qualifies as a non-resident for tax
purposes for tax year 2007. F-1 and J-1 students, and their F-2 and
J-2 dependents, qualify as non-residents if they have been in the
United States in that status since 2003 or later. F-1 or J-1 students
who have been in the United States in that status for more than five
years (2003 or earlier) are considered to be residents for tax
purposes.
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J-1 scholars and their dependents qualify as
non-residents if they have been in the United States in that status
since 2006 or later. J-1 scholars who have been in the United States
in that status for more than two years (since 2005 or earlier) are
considered to be residents for tax purposes.
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The personal exemption deduction (line 13 on form
1040NR EZ, line 38 on form 1040NR) is $3400 for tax year 2007. This
amount increases each year.
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The standard deduction (used only by students from
India as their tax treaty amount) is $5350 for single individuals and
those who are filing as "married filing separately" for 2007
on form 1040NR EZ. The standard deduction is $10700 for Indian
nationals who are filing as "married filing jointly" for
2007 on form 1040NR. Indian nationals enter the standard deduction
amount (line 11 on form 1040NR EZ, line 37 and page 3 line 3 on form
1040NR) instead of their state and local taxes.
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There is a new tax treaty with Bangladesh. Students
from Bangladesh who are employed, as well as professors and
researchers from Bangladesh can now exempt certain amounts of income
from tax. See the section on "Tax Treaties" for more
information.
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There is a tax treaty in effect between Japan and
the United States that took effect January 1, 2005. Among the changes
brought about by this new tax treaty is that Japanese nationals who
are married and/or have children will no longer be able to able to
claim an exemption for their spouse and/or dependents. Also, under the
new tax treaty, Japanese nationals will no longer be able to claim the
$2000 exemption for wages from a U.S. employer. Those who entered the
United States on or before March 30, 2004 will be able to claim the
wage exemption, but not the dependent exemption.
Information provided by International Student and Scholar Services
Binghamton University (SUNY)
The UT Office of International Affairs is
neither qualified nor permitted to give individual tax advice. Students
with complicated tax situations may wish to consult with a tax preparation
service, professional tax accountant, or tax attorney who is knowledgeable
about nonresident tax law.
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