International students on F, J, M, or Q visas do pay U.S. taxes on money they earn from U.S. sources, including wages from campus jobs, CPT or OPT employment, and the taxable portion of scholarships or fellowships. For the first five calendar years in the country, though, these students file as nonresident aliens, which brings a different set of rules than U.S. citizens follow: exemption from Social Security and Medicare tax on wages, possible treaty benefits, no standard deduction in most cases, and different forms. Foreign-source income is not taxed by the U.S. at all during this period.
Why the First Five Years Are Different
Tax residency status controls everything else. The IRS sorts people into nonresident aliens and resident aliens, and the two groups face different rates, deductions, and forms.
Most international students on F, J, M, or Q visas are nonresident aliens for their first five calendar years in the United States.1Internal Revenue Service. Exempt Individual – Who is a Student The year you arrived counts as year one even if you landed in December. During these five years the IRS treats you as an “exempt individual” for the substantial presence test, so your days in the country don’t push you into resident status.2Internal Revenue Service. Substantial Presence Test
After that five-year window closes, your days start counting under the substantial presence test, and once the weighted total reaches 183 you become a resident alien and file the same forms as U.S. citizens.2Internal Revenue Service. Substantial Presence Test
What Income Is Taxed
Nonresident aliens owe U.S. tax only on income connected to the United States. Foreign-source income is not subject to U.S. tax.3Internal Revenue Service. Nonresident Aliens – Exclusions from Income
Wages
Wages from on-campus employment, Curricular Practical Training, Optional Practical Training, or other authorized work are taxed at the same graduated rates U.S. citizens pay.4Internal Revenue Service. Nonresident Aliens Your employer withholds federal income tax from each paycheck, and you square up on your annual return.
Scholarships and Fellowships
The portion of a scholarship or fellowship used for tuition, enrollment fees, books, supplies, and equipment required for your courses is tax-free.5Office of the Law Revision Counsel. 26 USC 117 – Qualified Scholarships Amounts covering room and board, travel, or optional equipment are taxable, and if the scholarship requires you to teach or do research in exchange, that compensation piece is taxable too.6Internal Revenue Service. Publication 970 – Tax Benefits for Education
Default federal withholding on taxable scholarship income paid to nonresident aliens is 30%, but for F, J, M, and Q visa holders it drops to 14% when the amount comes from a qualifying scholarship or organization.7Internal Revenue Service. Withholding Federal Income Tax on Scholarships, Fellowships and Grants Paid to Nonresident Aliens A treaty with your home country can reduce or eliminate this further.
Bank Interest Is Not Taxed
One point of common confusion: interest on deposits at U.S. banks, savings institutions, and insurance companies is generally not taxable for nonresident aliens, as long as it isn’t tied to a U.S. business you operate.8Office of the Law Revision Counsel. 26 U.S. Code 871 – Tax on Nonresident Alien Individuals A standard savings account won’t create a tax bill.
The FICA Exemption
Nonresident alien students on F-1, J-1, or M-1 visas who have been in the U.S. fewer than five calendar years are exempt from Social Security tax (6.2%) and Medicare tax (1.45%) on their wages.9Internal Revenue Service. Foreign Student Liability for Social Security and Medicare Taxes That’s 7.65% you keep that a U.S. worker doesn’t.
Some employers, particularly larger payroll departments unfamiliar with nonresident rules, withhold FICA anyway. Ask your employer to correct the error and refund the money first. If the employer won’t, file Form 843 with the IRS to request the refund yourself, attaching a copy of your W-2 and a statement explaining the situation.10Internal Revenue Service. Instructions for Form 843 The amounts add up quickly, so don’t let it go.
Treaty Benefits
The U.S. has income tax treaties with dozens of countries that can reduce or eliminate U.S. tax on certain income for students. Common benefits include exemptions on wages up to a set dollar amount, reduced or zero tax on scholarship income, and exemptions for teaching or research compensation. IRS Publication 901 lists every country with an active treaty and the specific benefits available.11Internal Revenue Service. Publication 901 – U.S. Tax Treaties
To claim treaty benefits on wages, give your employer a completed Form 8233 before the income is paid.12Internal Revenue Service. About Form 8233 For non-wage income like scholarships, use Form W-8BEN instead.13Internal Revenue Service. About Form W-8 BEN Both forms require a taxpayer identification number. Even when a treaty fully exempts your income, you still report it on your return.
Deductions and Dependents Are Limited
Nonresident aliens cannot claim the standard deduction. The only exception is students and business apprentices from India, who may claim it under Article 21 of the U.S.-India income tax treaty.14Internal Revenue Service. Nonresident – Figuring Your Tax Everyone else is limited to itemized deductions on expenses connected to U.S. income.
Itemized deductions available to nonresident aliens include state and local income taxes paid where you earned income, charitable contributions to qualifying U.S. nonprofits, and casualty and theft losses from a federally declared disaster. Certain above-the-line adjustments are also allowed if you qualify, including the student loan interest deduction and IRA contributions.14Internal Revenue Service. Nonresident – Figuring Your Tax Most students with only wages or scholarship income won’t have much to itemize.
Dependents are similarly restricted. Only nonresident aliens who are U.S. nationals or residents of Canada, Mexico, or South Korea can claim qualifying dependents. Students from India eligible under Article 21(2) of the U.S.-India treaty may also qualify.15Internal Revenue Service. Nonresident Aliens – Dependents For everyone else, the dependent exemption isn’t available.
Getting a Tax ID Number
You need a taxpayer identification number before filing. Students use one of two types.
If you’re authorized to work in the U.S., you’re eligible for a Social Security Number. Applying requires immigration documents and, for on-campus employment, a letter from your designated school official confirming enrollment and employment.16Social Security Administration. International Students and Social Security Numbers You don’t need the SSN in hand before starting work, but apply as soon as possible.
If you’re not eligible for an SSN but have a filing requirement, such as a taxable scholarship, apply for an Individual Taxpayer Identification Number using Form W-7, submitted with your tax return and original identity documents or certified copies. A passport works on its own; otherwise you’ll need at least two other qualifying documents from the IRS’s accepted list.17Internal Revenue Service. Instructions for Form W-7 Processing runs about 7 weeks, or 9 to 11 weeks during tax season (January 15 through April 30) or from overseas.18Internal Revenue Service. Individual Taxpayer Identification Number (ITIN)
Which Forms You File
The federal filing deadline for the 2025 tax year is April 15, 2026, shifting to the next business day if it falls on a weekend or holiday.19Internal Revenue Service. When to File
Form 8843 (Everyone)
Every international student on an F or J visa present in the U.S. during the tax year must file Form 8843, even with no income at all. The form tells the IRS you’re an exempt individual under the substantial presence test.20Internal Revenue Service. About Form 8843 If you have no income and are only filing Form 8843, mail it to the Department of the Treasury, Internal Revenue Service, Austin, TX 73301-0215 by the Form 1040-NR due date.21Internal Revenue Service. Form 8843
Form 1040-NR (If You Had Taxable Income)
If you earned wages, received taxable scholarship income, or had other U.S.-source taxable income, file Form 1040-NR alongside Form 8843. This is where you report income, claim treaty benefits and deductions, and calculate tax owed or refund.22Internal Revenue Service. Taxation of Nonresident Aliens Form 1040-NR can now be e-filed through commercial tax software, and paid preparers are generally required to e-file.23Internal Revenue Service. Instructions for Form 1040-NR (2025)
State Taxes
Federal is only half the picture. If you earned income in a state with an income tax, you likely need to file a state return too. The general rule is straightforward: income earned in a state is taxed by that state regardless of citizenship or visa. A handful of states have no individual income tax, so students there skip this step. Each state has its own forms and thresholds, and your university’s international student office can point you to the right resources.
Penalties for Not Filing
If you owe tax and miss the deadline, the IRS charges a failure-to-file penalty of 5% of the unpaid tax for each month the return is late, up to 25%. If the return is more than 60 days late, the minimum penalty is $525 or 100% of the unpaid tax, whichever is smaller.24Internal Revenue Service. Failure to File Penalty Unpaid tax also accrues interest daily from the day after the deadline.
Even if you owe nothing, skipping Form 8843 each year can cause problems later if the IRS questions your nonresident status. And if you plan to apply for a work visa, green card, or citizenship down the road, a clean tax filing history matters.
Where to Get Help
Tax software built for nonresident aliens is the most common route. Products like Sprintax and Glacier Tax Prep handle Form 1040-NR and treaty calculations. Many universities license one of these programs and offer it free to their international students, so check with your international student office before paying. Sprintax supports both federal and state returns; Glacier is federal only.
The IRS also runs the Volunteer Income Tax Assistance program, which provides free preparation for people with low to moderate income.25Internal Revenue Service. IRS Tax Volunteers Some university VITA sites are specifically trained on nonresident alien returns. Professional preparers who specialize in this area typically charge $400 or more, so it’s worth exploring free options first.