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Tax Treaty Benefits for Resident Aliens

 

Federal

Resident aliens for tax purposes follow the same guidelines and use the same forms as U.S. citizens.

  • You may not be required to file any tax forms at all if your gross income is below the minimums found in the IRS Filing Requirements Chart for Most Taxpayers.

  • Resident aliens for tax purposes file IRS Form 1040 (or Form 1040-SR for those age 65 or older). You may be able to e-file your tax return. This year, 2024 tax forms must be postmarked or e-filed no later than April 15, 2025.

  • You are not required to file Form 8843

  • You must report your worldwide income, not just your U.S. income

  • Your bank interest is considered taxable income

 

State

The guidelines at the Ohio Department of Taxation website states a resident alien for tax purposes is taxed in the same way as a U.S. citizen. This means you are subject to Ohio's individual income tax on all of your worldwide income, not just income earned in Ohio. 

An individual's tax residency status (resident or nonresident) is determined by federal tax law, specifically the IRS, and is separate from immigration status. Generally, this is based on either the "green card test" or the "substantial presence test". 

 Even if you are not required to file a State of Ohio tax form, you may want to do so anyway if too much tax was withheld from your income and you are due a refund. If you do not file a Ohio tax form, the State of Ohio will keep your refund.

 For more information,  please review these handouts from the Ohio Department of Taxation 

 

Tax Treaties with Other Countries

Under certain limited circumstances, international students and scholars from tax treaty countries may be eligible to claim treaty benefits even though they are considered resident aliens for U.S. tax purposes. If you are a resident alien for U.S. tax purposes AND are eligible to claim an income tax treaty exemption, follow the steps below. Please also review the “Resources” section below to learn when resident aliens for U.S. tax purposes can claim tax treaty benefits.

  1. Go to the IRS website to obtain Form 1040 (and its instructions), Schedule 1, and Schedule OI of Form 1040-NR. Please note that depending on your situation, there may be additional Schedules that also apply to you;

  2. Complete all of the income lines on Form 1040, as well as any other Schedules, as applicable to you;

  3. On Schedule 1, Line 8z (Other Income), write "U.S.-{country} tax treaty, Article {article number}”. Also on Schedule 1, Line 8z, enter the total amount you wish to claim as a tax treaty exemption as a negative number. Then, in effect, the amount of tax treaty exemption will be subtracted when you enter a total on Schedule 1, Line 9. Complete Line 10 as indicated on Schedule 1;

  4. Enter the amount from Schedule 1, Line 10, onto your Form 1040, page 1, Line 8;

  5. On Schedule OI, complete your name and Social Security Number, write "Resident Alien with Tax Treaty Exemption” across the top of the page, and complete ONLY Section L;

  6. Attach Schedule 1 and Schedule OI to the back of your Form 1040. If you received a Form 1042-S or Form W-2, attach the applicable copies to the front, bottom section of Form 1040;

  7. Regardless of where you live, MAIL your Form 1040, Schedules and other applicable documents to:

IF NO Additional Tax is Due:

IF Additional Tax is Due:

Department of the Treasury
Austin, TX 73301-0215
(no street address is needed)

Internal Revenue Service
P.O. Box 1303
Charlotte, NC 28201-1303

 

Internet Resources: Claiming treaty benefits as a tax resident