Transcript TAX TREATIES - Michigan Technological University

TAX TREATIES
Sara Marcotte
Accountant
Accounting Services
UNITED STATES INCOME TAX
A
tax that the government imposes on
income earned by individuals.
 Income
tax is a key source of funds that
the U.S. government uses to fund its
activities and serve the public.
 Income
 Can
tax is “withheld” from wages.
be referred to as “federal
withholdings”
WHAT IS A TAX TREATY?
 Formal
written agreement between
countries
 U.S.
has tax treaties with a number
of countries
 Residents
of foreign countries are
taxed at a reduced income tax rate or
exempt from U.S. taxes on certain
types of income
TAX TREATIES -CONTINUED
 Not
 Not
all countries have tax treaties
all tax treaties are the same.
Each country has their own
“agreement” with the United States.
TAX TREATIES & STUDENT
WAGES
 Some
countries have tax treaties with
the United States that exempt student
wages from income tax.
 Certain
conditions need to be met in
order for student wages to be exempt:
1) Length of time in the United States
2) Amount of Earnings
http://www.admin.mtu.edu/acct/dept/tax/nrstudentwages.htm
FORM 8233
 Qualify
8233
for tax treaty? Fill out form
 Form
8233 is a form that exempts your
wages from income tax. There will be
no “withholdings” from the wages you
earn.
 Must

be filled out annually.
http://www.admin.mtu.edu/acct/dept/tax/8233info.htm
WHAT IF 8233 IS NOT
COMPLETED?
 When
you file tax return at the end
of the year – you can be refunded the
income tax that was “withheld”.
HELPFUL WEBSITES
Tax Treaties:
http://www.irs.gov/businesses/internati
onal/article/0,,id=96739,00.html
Summary of Tax Treaties:
http://www.irs.gov/pub/irs-pdf/p901.pdf
Student Wages & Form 8233:
http://www.admin.mtu.edu/acct/dept/tax/
nrstudentwages.htm
QUESTIONS?
SEE ME!
Sara Marcotte
[email protected]
487-2449