NON-RESIDENT ALIEN TAXPAYERS Instructions for Tax Year 2019 This information is provided for information purposes only. Your personal circumstances may dictate other filings.
Recent News Coverage on Tax Payment Extension • The federal government recently extended the deadline to pay your taxes to July 15, 2020. • This is only a deadline to PAY your taxes – you must still FILE BY APRIL 15, 2020. • If you do not file by April 15, 2020 you will still be charged penalties and interest if you owe more tax. • If you cannot file by April 15, 2020, you can request one automatic 6-month extension by filing form 4868. • MUST file form 4868 by April 15 to be considered a valid extension request. • You can file form 4868 at irs.gov.
Getting Started • You must postmark your federal and state tax returns by 11:59 pm on Wednesday, April 15, 2020. • The sooner you file your tax returns, the sooner you will receive any refund for which you may be eligible. • Make all letters and numbers very clear and legible on your tax returns. • Use pen, not pencil, to prepare your returns. • Staple a copy of your W2 and/or 1042S to your federal 1040NR or 1040NR-EZ.
Getting Started • Be sure to use the exact name and social security number or taxpayer identification number that appears on your social security card or ITIN notice. • Your must sign your tax returns before you mail them to the IRS, Michigan Department of Treasury, and City of East Lansing. An unsigned tax return is not a valid return. You are signing your tax return under penalties of perjury, so it important to be honest in your preparation of your return. • Always make a copy of your tax returns and supporting documents before you mail them. • Keep these copies as part of your personal records for six years in case the IRS, Michigan Department of Treasury, or City of East Lansing has questions about the returns you filed. It’s not a bad idea to keep them for an even longer period of time. • Make sure you put proper postage on the envelope containing your tax return. A return sent with insufficient postage will not be delivered to the IRS, Michigan Department of Treasury, or City of East Lansing
Types Of Year-End Statements • Form W-2 shows how much you earned in 2019. It also shows how much federal and state income tax have been withheld from your wages by your employer. • This is what a typical W-2 looks like, although yours may look somewhat different. Even if your W-2 looks different that the example shown here, the box numbers will always be the same. Box B: Box 1: Wages Employer’s Box 2: Federal Tax Withheld EIN Box 17: State Tax Withheld
Types Of Year-End Statements • Form 1042-S Foreign Person’s U.S. Source Income Subject to Withholding – This document shows amounts that are paid to foreign persons for various types of income categories. Not all nonresident alien taxpayers will receive this document. You may receive one if you were the recipient of a scholarship. Box 1: Box 7a: Federal Income Code Income Tax Box 2: Gross Withheld Income Box 14b: Primary Withholding Agent’s EIN Box 17A: State Tax Withheld
Types Of Year-End Statements Form 1099-G is a form used by a governmental agency to show certain types of amounts paid to you during 2019. If you received a tax refund last year from the State of Michigan or another state, the state may have sent you a 1099-G. Depending upon your circumstances, you may not have to report this income.
Types Of Year-End Statements • Form 1099-DIV reports any dividends you received in 2019. • Note: Credit unions refer to interest as dividends, the 1099-DIV is not used to report credit union dividends. Credit unions will report dividends on a 1099- INT. This form may not have been mailed to you, and you may have to retrieve this amount from your credit union’s website. For example for the Michigan State University Federal Credit Union, you would go to www.msufcu.org.
Types Of Year-End Statements • Forms 1099-INT or 1042-S shows how much bank (or credit union) interest you earned during the tax year. • If you earned less than $10 in bank interest in 2019, the bank was not obligated to report it to the IRS.
Types Of Year-End Statements • Form 1099-MISC is used to show any miscellaneous income you may have received from work or other parties. If you are an independent contractor and not an employee, payments made to you for your services are reported on a 1099-MISC. You may also have received this form for amounts paid for attendance at or travel to a conference.
Types Of Year-End Statements • Form 1098-T is used by an educational institution to report qualified tuition payments you made in 2019. A 1098-T is used by resident alien taxpayers to claim an education credit as well as to substantiate an educational deduction. • A non-resident alien taxpayer is not eligible to claim a federal education credit.
Types of Year-End Statements • Form 1095-A, B, or C is used to report health coverage as required by the Affordable Care Act. Nonresident aliens are not subject to the Affordable Care Act and will not need this form to complete their tax return.
GLACIER Tax Prep Software • Used Glacier for previous years? • Sign In • New to Glacier? • You will need to create a Username/Password to access the GLACIER Software. • Select “Create New Account”
GLACIER Tax Prep Software • The Access Code was emailed to you by either taxclinic@law.msu.edu or by OISS.
GLACIER Tax Prep Software • Once you have created a Username and password, please log in to the GLACIER Tax Prep Software.
GLACIER Tax Prep Software • Step 1: Determine Residency Status. This step is very important because your residency status will determine which tax forms you need to file.
Determining Residency Status: Personal • Please enter your personal information in the lines provided. • You must enter information onto any line with a red asterisk next to it Note: In general, your Country of Tax Residence will be the country where you resided directly prior to coming to the US. Otherwise, your Country of Tax Residence is generally the same as your Country of Citizenship.
Determining Residency Status • Next, you will need to enter information regarding EACH TIME you were present in the United States. • Enter all U.S. entry and exit dates from 1986 to 2019 • DO NOT ENTER 2020 DATES! • Do not enter tourists’ visas • If you were present in the United States between December 31, 2019/ and January 1, 2020 you will check the box “Still In US” and will not need to give a Date of Exit.
Determining Residency Status • The software will then inform you of your residency status for 2019: • If the software indicates that you were a RESIDENT for 2019, you will need to contact another tax return preparer. As a resident, you must file different tax forms and if you use this presentation to complete your returns, you returns will be wrong! • VITA is a free organization with locations all around Michigan. Unfortunately due to COVID-19 these sites are closed for the near future. You may need to contact a paid preparer to complete your return if you are resident.
Entering Income Statement Information • Next you will be prompted to enter information from any income statements you received from an employer, educational institution (such as Michigan State University), or from another source. • You may have more than one type of year end statement to enter information about. • Once you have entered information from all of your year end statements click “Next” at the bottom of your screen.
Postcard – 1099-G Enter “0” Enter Box 2 “refund” amount Enter “Federal I.D. # Enter “0” for federal Income tax withheld
Sample W-2 Statement • Transfer any information included on your income statement into the GLACIER Tax Prep Software exactly as it appears on the W-2.
Sample W-2 Income Statement • You must also indicate at the bottom of the page where the income was earned. If you worked for Michigan State University you will select “College or University.”
Income Tax Treaty Benefits • The GLACIER Tax Prep Software will let you know if you are eligible for benefits under an Income Tax Treaty. • When you click “Next” at the bottom of the page, you will see a summary of Total Income from US Sources – if this information appears to be correct, please click “Go To STEP THREE” at the bottom of the page.
Income Tax Treaty Benefits ***** Review your available treaty benefits carefully. Every country is different, and you must make the decision yourself if you wish to take treaty benefits. ****** **** The Tax Clinic does not know the tax laws of other countries so we cannot answer this question for you. You may need to inquire with the appropriate agency in your home country. *****
Enter Your U.S. Address • Enter the requested information and click “Next.”
Enter Your Address in Your Home Country • Enter the requested information and click “Next.”
Enter Your U.S. Issued Taxpayer Identification Number • Enter your Social Security Number or ITIN on the line provided, or • If you DO NOT have an SSN or ITIN, check the box to apply for one now and click next. The application form (a “W-7”) will be generated for you through Glacier. Read the W-7 instructions very carefully as you must send certain documents with your application.
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