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Old 02-13-2014, 01:49 PM
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Claiming Tax treaty benefit for 2012

I am a researcher on J1 exchange visa residing in the USA since 22nd Mar 2012. For Tax year 2012 I paid my entire tax liability (by filing form 1040-NR) but now I know that there is a tax treaty between India and US (article 22 of IRS pub 901) according to which I do not have to pay Federal taxes for a period of 2 years starting 22-Mar-2012. What forms do I have to fill now to claim my tax money back? I am leaving USA on 20-Mar-2014. Grateful for any answers or references.



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Old 02-14-2014, 01:35 AM
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Originally Posted by piyalic View Post


I am a researcher on J1 exchange visa residing in the USA since 22nd Mar 2012. For Tax year 2012 I paid my entire tax liability (by filing form 1040-NR) but now I know that there is a tax treaty between India and US (article 22 of IRS pub 901) according to which I do not have to pay Federal taxes for a period of 2 years starting 22-Mar-2012. What forms do I have to fill now to claim my tax money back? .
Due to US tax treaty between US and India, you, as a J-1 Visa holder, are exempt from FUTA/FICA tax/ and Fed, however, it should also be noted that, in most states, the tax exemption does not apply to thestate income tax.You can be totally exempt from all federal taxes for a period of time which is set by the treaty. However, this exemption is NOT automatic. It must be addressed in a tax treaty, which sets the conditions that must be met to qualify and also sets the time limit for the tax-exempt status.ALSO, you must/had to file form 8843 and attach it to your 1040NREZ /1040NR . You need to get the FICA tax refund refusal in writing by submitting Form 843 to get FICA taxes withheld from your paychecks refunded.You should submit this form separate from your annual tax return. Form 1040X can be used to correct previously filed Forms 1040, 1040A, 1040EZ, 1040NR, or 1040NR-EZYou need to file Form 1040NR /1040NR-EZ with Form 8843. On the return you should show tax withheld to get the refund.You cannot efile a 1040nr/1040nr-ez. It must be mailed in.

Note; aslongas you, as a the J-1 visa holder, EXCEED the specified tax exemption time limit, then the tax exemption is void and all federal income taxes become due retroactive to the date of yur arrival.



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