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Tax Question

1462 Views 4 Replies 3 Participants Last post by  Bevdeforges, 
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Question for anyone with a backround in US tax issues or anyone who has been through this before.
I am currently in the US on a J Internship Visa that expires on September 31st 2009. On October 1st I will be starting my H1-B visa. My question is when it comes to filing taxes for 2009, will my income be split into two different peroids (i.e from january 2009 to septmeber 31st 2009, and October 1st to the end of the year) to determine my tax refund or will it all be subject to the tax guidelines for a H1-B visa seeing as this will be my visa status at the end of the year?
Only really concerned because on the J visa status I would be due a much larger refund than I would be on the H1-B visa as far as I know, although I am open to correction.

Thanks in advance
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Bevdeforges
Your visa status has nothing to do with your tax returns. Income is either taxable or not, but you declare it all under the appropriate category.

How do you figure you'd be due a larger refund under the J visa than under the H1-B? You aren't taxed on annualized pay, but on your actual pay for the year in question. If you've been overwithheld on your J visa job, you just apply the overage to what you'll owe on the H1-B salary at the end of the year. A tax refund is nothing but over-withholding - it doesn't reflect your actual taxes paid or due. That has to be figured out at the end of the year when you file your return.
Cheers,
Bev
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Bevdeforges said:
Your visa status has nothing to do with your tax returns. Income is either taxable or not, but you declare it all under the appropriate category.

How do you figure you'd be due a larger refund under the J visa than under the H1-B? You aren't taxed on annualized pay, but on your actual pay for the year in question. If you've been overwithheld on your J visa job, you just apply the overage to what you'll owe on the H1-B salary at the end of the year. A tax refund is nothing but over-withholding - it doesn't reflect your actual taxes paid or due. That has to be figured out at the end of the year when you file your return.
Cheers,
Bev
Click to expand...
Thanks for the reply.
As a J visa holder you are due a refund of approx. 50% of your federal tax paied during the year and a small proportion of your state. You are also excempt from paying Social Security and Medicade taxes for the duration of your visa. I know this as my J visa began in May of 2008 so i filed taxes for 2008 using an accountant who told me this.
My question is does anyone who knows what changes there are (if any) when my visa changes from J1 to H1-B?
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Fatbrit
abroad_ny said:
Thanks for the reply.
As a J visa holder you are due a refund of approx. 50% of your federal tax paied during the year and a small proportion of your state. You are also excempt from paying Social Security and Medicade taxes for the duration of your visa. I know this as my J visa began in May of 2008 so i filed taxes for 2008 using an accountant who told me this.
My question is does anyone who knows what changes there are (if any) when my visa changes from J1 to H1-B?
Click to expand...
Surprisingly for a government entity, the IRS helplines are pretty good on questions like these. I'd give them a try if I were you.
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Bevdeforges
abroad_ny said:
Thanks for the reply.
As a J visa holder you are due a refund of approx. 50% of your federal tax paied during the year and a small proportion of your state. You are also excempt from paying Social Security and Medicade taxes for the duration of your visa. I know this as my J visa began in May of 2008 so i filed taxes for 2008 using an accountant who told me this.
My question is does anyone who knows what changes there are (if any) when my visa changes from J1 to H1-B?
Click to expand...
For information regarding the social security and Medicare:

Foreign Student Liability for Social Security and Medicare Taxes

It looks like you'll move to paying full social security and Medicare when you start your H1B job in September.

I'm not so sure about that 50% of federal and state taxes paid during the year, though. If you started your visa in May of last year, it's only normal that you'd get a substantial refund, as you were only employed for one-half the year, yet were withheld based on your full year's salary.

Tax withholding is only an estimate of what you will owe at the end of the year. If you know you'll owe considerably more or less, you can adjust your withholding to better match your obligation.

For 2009, your federal and state income tax bill will be based on your total salary for the year, regardless of which visa it was earned under.
Cheers,
Bev
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