W-4 and Taxes for J-1 Students
Understanding Taxes and the W-4 Form for J-1 Work and Travel Participants: Your Guide to Navigating U.S. Taxation Laws and Ensuring Proper Withholding
W-4 Form
All non-resident aliens must complete a W-4 form when they begin employment. This form is given to you by each employer for whom you work.
Remember to use the CCUSA Tax Service address as it appears on the sample when you complete the W4 for your employer.
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Here is a step-by-step guide on how to fill out a W-4 form:
Step 1: Provide your personal information Enter your full name, address, Social Security number (SSN), and filing status (e.g. single, married filing jointly, head of household) in the appropriate fields.
Step 2: Claim allowances Determine the number of allowances you can claim by using the Personal Allowances Worksheet on the W-4 form. This worksheet takes into account your filing status, number of dependents, and other factors that affect your tax liability.
Step 3: Claim additional income If you have additional income not subject to withholding (such as self-employment income), or if you have multiple jobs or a working spouse, you may need to claim additional allowances or adjust your withholding amount to ensure that enough taxes are being withheld.
Step 4: Specify any additional withholding If you want to have additional federal income tax withheld from your paycheck (above and beyond the standard withholding based on your allowances), you can specify an additional withholding amount in Step 4 of the W-4 form.
Step 5: Sign and date the form Review your completed W-4 form and make sure all information is accurate. Then sign and date the form, certifying that the information is correct to the best of your knowledge.
Step 6: Submit the form to your employer Provide the completed W-4 form to your employer so they can start withholding federal income taxes from your paycheck based on the information you provided.
It's important to review and update your W-4 form periodically, especially if you experience any major life changes (such as getting married, having a child, or starting a new job). This will help ensure that your withholding amounts are accurate and you're not caught off guard with a large tax bill at the end of the year.
Taxes
All American Work Adventures Participants are required to pay Federal and State taxes, however, you are exempt from Medicare and Social Security. Federal Unemployment Taxes will vary from state-to-state and you may be required to pay these taxes. Some taxes may be refunded back to you. In order to receive a any taxes refunded you will need to submit what is called a "W2 form". This W2 form is provided to you by your employer after you complete your work program. The W2 will list the total amount of wages you earned and the amount of taxes withheld.
For the relevant tax legislation refer to: Publication 15 - Circular E, Employers Tax Guide Section 15 - Special rules for various types of services and payments Special Classes of Employment - Student, scholars, trainees, teachers, etc. Point 5 - Nonimmigrant alien holding F-1, J-1, M-1 or Q-1 visas.
This publication can be downloaded from: www.irs.gov/pub/irs-pdf/p15.pdf.
All AWA Participants should be issued a W-2 form so they can file tax returns.
Payroll Taxes and Deductions
Final Paychecks: W4 & W2’s
AWA encourages Students to communicate with their Host Employer regarding their last paycheck ahead of time. Students should communicate with their Host Employer regarding how and when they will receive their last paycheck, prior to their departure. It will help avoid unnecessary problems and/or misunderstandings or to describe what your business does.
W4
• All AWA Students must fill out their W-4 form (Employee Withholding Allowance Certificate), which usually happens upon their arrival to their Host Employer. Students should ask their Host Employer to assist them in completing this form.
• Students are also required to file for the U.S. income tax by April 15 of the year following the year in which they worked in the U.S.
W2
• The IRS requires employers to report wage and salary information for employees on Form W-2. The W-2 also reports the amount of federal, state and other taxes withheld from a Student’s paycheck. As an employee, the information on a Student’s W-2 is extremely important when preparing their tax return. AWA always asks Host Employers to send Students’ W-2 forms to their permanent address in their home countries. It may also be easier to send Students their W-2 form via-email. Students should make all arrangements directly with their Host Employer prior to their return to their home country.
Tax Updates:
Tax Filing Requirement for 2018 and future years
Starting in 2018, all non-residents that have US earnings will be required to file a Federal income tax return regardless of the amount earned. It is very important that the employers are withholding the correct amount of taxes (10% of the first $9,525 in earnings). If less is withheld, then the J-1 participant will owe additional Federal taxes when they file their tax return and will need to pay the balance due when filing the return.
State Income Taxes
If the J-1 participant is working in a State that has state income taxes withheld, there may be State income taxes that are refundable. The amount varies by State. To obtain a refund of State taxes, a Federal tax return must first be filed, and a copy submitted with the State income tax return. In cases where State income taxes have been withheld, that will result in a small Federal tax refund as the State income tax is deductible on the Federal tax return. The amount of the State tax refund will vary by State as each State has their own tax laws.