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U.S. Taxation of Common Visa Types: H1-B, F-1/J-1, B-1/B-2, TN, EB-1, and Others

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Tuesday, May 9, 2023

Recorded event now available

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This course will address U.S. nonresident taxation by visa type. The panelist will identify common visa categories and explain when a visa holder is subject to U.S. taxation of income, what treaty and other benefits may be available to mitigate taxation, and when U.S. earnings are subject to Social Security tax.

Description

There are many visas issued to nonresidents who travel to the United States for work or pleasure, along with permanent residence, better known as the "green card." Each visa type and the nature of the traveler's stay affect the traveler's U.S. tax liability.

U.S. visa holders will need to determine if they are treated as a resident or a nonresident in order to properly file their tax return. Some visas provide special exemptions to residency, which is typically determined using the Substantial Presence Test. Beyond these exemptions, there are elections and positions that can be taken by the individual to adjust their residency status. This can complicate employer reporting and withholding requirements which vary between residents and nonresidents.

Providing additional relief and further complicating the determination are treaty benefits. U.S. tax treaties with other countries contain provisions to eliminate double income taxation and often include totalization agreements to avoid double taxation of Social Security. Certain visa types are exempt from Social Security/Medicare taxes. Visa holders who are subject to Social Security/Medicare may benefit from social tax agreements that the U.S. has entered into. These "totalization agreements" are intended to avoid the double taxation of Social Security taxes. Tax practitioners working with nonresidents in the U.S. need to understand the U.S. tax implications by visa type and maximize applicable tax benefits.

Listen as Ragini Subramanian, Senior Manager at Eisner Advisory Group, explains the different classes of visas and each classification's income and withholding tax implications.

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Outline

  1. Common visa types
    1. H-1B: highly qualified professionals
    2. F-1/J-1: students and exchange students
    3. B-1/B-2: business and tourist travelers
    4. TN: skilled workers from Canada and Mexico
    5. Green card
    6. L-1 intracompany transferee
  2. Income taxes
    1. Substantial presence test
    2. Visa-based exemptions
    3. Tax treaties
    4. Employer reporting obligations
  3. Social Security/Medicare taxes
    1. Exemption
    2. Totalization agreements
  4. Other considerations

Benefits

The panelist will review these and other critical issues:

  • Identifying specific visa types and their relative U.S. reporting and tax obligations
  • How to determine specific treaty benefits available to neutralize U.S. taxation
  • Which visa types are exempt from Social Security withholding and steps to obtain the exemption
  • When is a nonresident required to file a U.S. income tax return?
  • Employer obligations for reporting and withholding

Faculty

Subramanian, Ragini
Ragini Subramanian
Senior Manager, International, Private Client Services
Eisner Advisory Group

Ms. Subramanian is a Tax Senior Manager in the Private Client Services Group. With over 10 years of tax experience, she...  |  Read More

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