Taxes & Withholdings for International Postdocs
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Description
International postdoctoral trainees may be subject to federal, state, and local tax requirements depending on appointment type, tax residency status, income source, treaty eligibility, and other individual circumstances.
OPA cannot provide personal tax advice. Postdoctoral trainees should consult Penn tax resources, IRS guidance, Sprintax, or a qualified tax professional for questions about their individual tax situation.
Federal Tax Residency
For federal tax purposes, non-U.S. citizens may be classified as resident aliens or nonresident aliens. Tax residency for federal tax purposes is determined by IRS rules, including the Substantial Presence Test or Green Card Test.
Tax residency for federal tax purposes is not always the same as immigration or visa status.
For information on determining federal tax residency status, review IRS Publication 519: U.S. Tax Guide for Aliens.
Federal Withholding and Tax Forms
Federal tax withholding may apply to nonqualified scholarship or fellowship payments issued to nonresident alien postdoctoral trainees.
Generally, IRS regulations require federal income tax withholding on nonqualified scholarship and fellowship payments made to individuals in F, J, M, or Q visa status, unless an applicable tax treaty benefit applies.
Payments and treaty benefits may be reported to the individual and the IRS on Form 1042-S. For information on determining the taxable portion of grant payments, see “Scholarships and Fellowship Grants”, IRS Publication 519, US Tax Guide for Aliens, Ch 3, p.16.
Postdoctoral trainees should review Penn ISSS tax guidance for information about Sprintax, Form 1042-S, Form 8843, and annual filing obligations.
Tax Treaties
Tax treaties may reduce or eliminate federal tax withholding on certain payments to eligible nonresident taxpayers.
Eligibility may depend on country of tax residence, visa status, prior visits to the United States, payment type, and other treaty requirements. Information provided through Penn’s foreign national tax process is reviewed to determine whether a treaty benefit may apply.
Postdoctoral trainees may review IRS Publication 901: U.S. Tax Treaties for general treaty information.
State and Local Taxes
Postdoctoral trainees may be subject to Pennsylvania state tax and Philadelphia wage tax depending on appointment type, residency, compensation source, work location, and other individual circumstances.
State and local tax rules may differ from federal tax rules. Postdoctoral trainees should review Penn Finance guidance and consult a qualified tax professional with questions about state or local filing obligations.
Note for NRSA Postdoctoral Fellows
Most NRSA Postdoctoral Fellows are U.S. citizens, non-citizen nationals, or lawful permanent residents because many NRSA mechanisms have citizenship or permanent residency requirements.
In limited cases, an internationally born or internationally trained postdoctoral trainee may hold lawful permanent residency or otherwise meet the eligibility requirements for a specific training or fellowship mechanism.
Tax treatment may vary based on appointment type, funding source, residency status for tax purposes, and individual circumstances. NRSA Postdoctoral Fellows and international postdoctoral trainees with questions about tax residency, withholding, treaty benefits, or filing obligations should consult Penn tax resources or a qualified tax professional.
qualified tax professional.
Penn Policy and Related Guidance
For international tax guidance, review Penn ISSS Tax Information and ITIN.
For Penn payroll tax resources, review Penn Division of Finance Tax Resources.
For additional IRS guidance, review:
- IRS Publication 519: U.S. Tax Guide for Aliens
- IRS Publication 901: U.S. Tax Treaties
- IRS Publication 970: Tax Benefits for Education, if applicable