Federal and State Income Taxes

In most instances, international students and scholars in nonimmigrant visa classifications must pay city, state and federal taxes if employed by the University of Pennsylvania. In certain instances they may be exempted because of tax treaty between the United States and their home country, or if their employment can be considered to be a fellowship, as defined by the IRS. Tax determinations are complex and do not always follow the categories of immigration law. Depending on the particular circumstances, an international student or scholar in F-1 or J-1 status, could be considered a "nonresident alien for tax purposes"; under other circumstances, the same nonimmigrant could be considered a "resident alien for tax purposes."  Most F-1 and J-1 students are considered to be nonresidents for taxation purposes during their first five years of presence in the US. J-1 scholars are considered to be non-residens for taxation purposes during their first two years of presence in the US. It is important to note that these are calendar years, so if you arrive at any point in a year, even on December 30, that will count as the first year of presence.

In addition, students in F-1 and J-1 status do not pay US social security (FICA) and medicare tax for the first five calendar years of presence in the US Scholars in J-1 status are exempt from FICA for the first two calendar years of presence in the US. After that point, they become resident taxpayers and are subject to FICA withholdings. Holders of H-1B status are subject to FICA withholdings, and are generally considered to be tax residents after their first six months of presence in the US.

All international students and scholars who have nonresident tax status, regardless of whether or not there is any US source income, must file an annual tax return.

The University's Corporate Tax Office (located in 329 Franklin Building) will assist a student, scholar or department in determining the student's or scholar's tax status. Visit their web site at http://www.finance.upenn.edu/comptroller/tax/ for information of the documentary requirements.

On the ISSS web site, there are a number of tax information sheets. These information sheets are updated annually and the updated versions are generally available in late January or early February. Special tax advising hours are offered in March and April to help students and scholars prepare to file their annual tax returns (tax advice is also available during normal office hours at other times of the year).