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Old 11-30-2012, 08:19 PM
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Post Doctoral Taxes

I recently received an National Science Foundation post doctoral fellowship which includes money for research supplies, equipment, travel expenses, language courses and departmental overhead. I am not an employee for NSF nor my host University but rather a guest scientist. Also, I am not enrolled as a student. The funds for the research budget were deposited into my personal bank account and I am responsible for administrating this money over the next two years. My question is if this money (not my salary) can be taxed or is it exempt? If it's taxed how would I go about reporting it?



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Old 12-01-2012, 02:30 AM
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“ My question is if this money (not my salary) can be taxed or is it exempt?”------>Once it went towards paying for research-education expenses - doesn't get taxed. A scholarship or fellowship is tax free only if you are a candidate for a degree at an eligible educational institution; you use the scholarship or fellowship to pay qualified education expense, and it does not represent payment for teaching, research, or other services required as a condition for receiving the scholarship. You can contact the IRS for more info in detail;you can talk to an international tax representative at the IRS.



“ If it's taxed how would I go about reporting it?”-----> I guess you are a J1 visa holder as a guest scientist & post-doctoral fellow. J1 visa holders can benefit from certain tax exemptions and may also qualify for tax benefits under certain Tax Treaties. You, as long as(IF) some portion of the NSF fellowship is taxable) need to file 1040 NR/NR-EZ for two years;for example, assume that you came to US in 2012. You need to file 1040NR for 2012 and 2013.HOWEVER, if you decide to continue your stay here as your J1 get extended after 20013 , then for your 2013 return , you need to file 1040/1040A/EZ(if yu do not itemize your deductions on Sch A of 1040). You are exempt from Social Security and Medicare Taxes (FICA) Taxes for 2 years.You have to file form 1040NR-EZ and form 8843, to claim the exemption. Currently the U.S. has tax treaties or agreements with approximately 40 countries and territories under which their citizens may be exempt from all or part of U.S. federal income tax.To see if your country is among these and how a treaty may affect your tax status, visit the IRS Website here; Publication 901 (04/2012), U.S. Tax Treaties



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Old 12-01-2012, 08:15 AM
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Postdoctoral Fellowship

I understand the part about paying taxes on fellowship money I receive for carrying out research at my institution. I am actually doing research in Germany with a US fellowship. However how would I report non-salary research expenses, such as laboratory supplies, instrumentation usage fees, field-station usage fees, travel expenses, conference/registration fees, workshop expenses, or subscription fees?



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Old 12-01-2012, 03:07 PM
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“I am actually doing research in Germany with a US fellowship. However how would I report non-salary research expenses, such as laboratory supplies, instrumentation usage fees, field-station usage fees, travel expenses, conference/registration fees, workshop expenses, or subscription fees?”------> Any support a postdoc receives that is used to cover “living expenses” (as opposed to, say, tuition and fees laboratory supplies, instrumentation usage fees, field-station usage fees, /registration fees, workshop expenses, or subscription fees) is subject to income tax. In other words, all postdoc fellowships funded from U.S. sources are subject to income tax s long as they pay for living expenses. Expenses that do not qualify. Qualified education expenses do not include the cost of:Room and board,Travel,Research,Clerical help, orEquipment and other expenses that are not required for enrollment in or attendance at an eligible educational institution.Personal reasons and expenses that you have for this purpose would NOT make any of the above amounts become deductible expenses on your 1040 income tax return during the 2013 tax filing season for the 2012 tax year.How that tax is paid typically depends upon the type of funding and the postdoc’s employment classification and citizenship. However, often fellowships and traineeships are not subject to automatic tax withholding. This is most often true with “direct-paid” fellowships ,fellowship stipends that are paid directly to the postdoc, although it is sometimes the case with fellowships that are paid through the institution. Postdocs on fellowships must also file a tax return between January 15 and April 15 for the previous tax year. Postdoc fellows and trainees may receive a W-2 or 1099-MISC Form reporting their total fellowship income, or they may receive no summary form at all. In any case, a tax return must be filed and the fellowship stipend amount should be reported with gross income.
Those fellowships without automatic tax withholding are still subject to the IRS requirement that income tax be paid on a regular basis throughout the tax year, and not all at once at the end of the year. Thus, postdocs without withholding should make estimated tax payments each quarter in order to avoid a penalty. Use IRS Form 1040ES for estimated federal tax calculations and payments, and find the equivalent form for estimated state taxes .
You can talk to an international tax representative at the IRS or more taxation info in detail.



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