Tax Treaty Information
The United States has tax treaties with over sixty countries. UMMS students and researchers from countries that have a tax treaty agreement with the U.S. may be eligible for either a reduced rate or a complete exemption from U.S. income tax. Many tax treaties have treaty provisions (articles) that are specific to students/trainees or teachers/researchers. Tax treaty eligibility is determined as part of the on-boarding process at UMMS. More specifically, the treaty eligibility will be determined at your initial appointment with Immigration Services.
Immigration Services cannot advise on tax treaty eligibility prior to arrival in the U.S., nor can we change a title, document, etc. to make someone treaty eligible after entry to the U.S. (if they have already been determined to not be eligible). Below is some basic tax treaty information and resources to help you plan for your employment in the U.S.
Many tax treaties are based on a specified period of physical presence in the U.S. Therefore, if it is clear, that the intended stay exceeds that period, treaty benefits will NOT be granted based on the intent of the visit. For example, the teacher/researcher articles for some countries have a two-year prospective eligibility period. If someone who would normally benefit under this two year treaty, has been issued a Form DS-2019 (for J-1 exchange visitor) for a two-year period, but enters the U.S. one day or more before the start date of that two-year document, they will not be eligible to claim the treaty benefit (since the treaty eligibility is determined by physical presence and not the document start date). Another example would be if a researcher who could be eligible for a two-year treaty, entered the U.S. with a form DS-2019 that was valid for five years (since treaty eligibility is determined based on the prospective intent of the stay in the United States). In both cases above, Immigration Servicies cannot adjust the days on the immigration document to allow someone to claim a tax treaty.
Some tax treaties, particularly those for students/trainees have a certain amount of income that is exempt per year. Once that income is exceeded, any additional income will be taxed at the appropriate withholding rate. There are also treaties that have a one-time (ever) use limitation and treaties that may not contain treaty articles for students or researchers.
Tax treaty claims must be recertified annually by the individual making the claim. Immigration Services provides information and reminders at the end of each year, however, it is ultimately the indivdual's responsibility to recertify any treaty claims, when eligible.
Tax Treaty Resources
- The Internal Revenue Service (IRS) has information on current tax treaties
- The U.S. Department of Treasury has additional treaty information
- Windstar Technologies, Inc. - abbreviated tax treaties for individual benefits