Tax Treaties
Under the Internal Revenue Service, the US government maintains several international tax treaties based on country of foreign residence, not the country of citizenship or birth. They also vary in their terms and scope. Most tax treaties involve exempt dollar limits, which is the amount of earnings that can be exempt from income tax withholding. Any wages earned over the exempt dollar limit will have income tax withheld.
Different treaties may also involve an exempt time limit, which is the number of years a foreign employee can use the income tax treaty. This time limit begins at the date of arrival in the United States, not the first year the tax treaty exemption is claimed.
Treaties are only applicable to Non-Resident Aliens for tax purposes. To claim a tax treaty exemption, you must submit IRS Form 8233 to your employer prior to starting your employment and at the beginning of each new tax year. For payments from the University of Rochester: If are eligible and choose to claim a treaty benefit, GLACIER will generate this form for you. Alternatively, you may refer to IRS instructions in order to fill out your Form 8233.
For more information on tax treaties, read IRS Publication 901 (PDF). For frequently asked questions, please see below.
- How do I know if I am eligible for a treaty?
In general, in order to be eligible for a tax treaty in the US, a person must meet the following criteria: 1) be a resident of a country that has a tax treaty with the US, 2) be a Non-Resident Alien for Tax Purposes in the United States, 3) currently be earning qualifying income in the United States, and 4) have a US Social Security Number.
For international students at the University of Rochester, GLACIER will determine your eligibility for a tax treaty. If the information you put into GLACIER indicates that you are eligible for a tax treaty, GLACIER will prompt you to accept that tax treaty. If you previously completed GLACIER and were not informed of your eligibility for a tax treaty, it likely means you are not eligible for one.
- How do I claim a treaty that I am eligible for?
If you are eligible for a tax treaty and accept that treaty in GLACIER, GLACIER will generate the appropriate tax treaty documents for you along with your Tax Summary Report. You must print, sign, and submit these forms to the university Payroll office in order to actually claim the treaty and for the benefits of the treaty to take effect.
Please note that any forms generated by your University of Rochester GLACIER record and turned into the University of Rochester Payroll Office only apply to payments received from University of Rochester. If you are authorized for off-campus employment and receive payments from that employer, you would need to complete separate tax withholding forms and tax treaty documents for that employer.
- GLACIER told me I was eligible for a treaty but I did not accept it.
It is not mandatory to claim a tax treaty you are eligible for, so if you previously did not accept a tax treaty in GLACIER then that is not an immigration issue. It just means that your payments will be taxed as they would be if you were not eligible for a tax treaty at all.
If you decide you do want to claim a tax treaty you are eligible for, you can return to your GLACIER record and click through the screens to the page that asks you about the tax treaty to change your answer.
- What does it mean to renew a tax treaty?
After the first time you submit your completed tax treaty documents, those documents will eventually need to be renewed. Some tax treaty forms only last one year at a time so they must be renewed every year, while others cover multiple years and only need to be renewed periodically. Renewing your tax treaty means using GLACIER to generate next year’s version of the tax treaty forms and submitting those forms to the university Payroll office.
- When should I renew my tax treaty?
At the end of each year, GLACIER will determine whether or not your tax treaty forms need to be renewed. In general, the period to timely renew your tax treaty for the next year is October 15th – December 15th of the current year. It is best to submit your renewed tax treaty forms during these two months. If you submit the forms after this time, you will still be able to claim the tax treaty for the next year, but it is not guaranteed to take effect right away on January 1st and tax may be deducted from your paychecks until it is applied.
- How do I generate the necessary forms to renew my tax treaty?
If you are ready to renew your tax treaty for the next year, you should use GLACIER to generate the correct forms. There are two ways to do this:
Option 1: Create or update your GLACIER record and print the Tax Summary Report and additional forms. If you create or update your GLACIER record between October 15th – December 15th, GLACIER will generate two versions of all tax treaty forms for you—one for the current year and one for the next year. This is the best option if you have never turned in GLACIER before or if you have another substantive update to make in your GLACIER record.
Option 2: Use GLACIER to generate ONLY the required tax treaty forms for the new tax year. If you have recently updated GLACIER and have no other substantive changes to make to your GLACIER record, then you can use GLACIER to generate just the new tax treaty documents that you need. To do this, log into GLACIER and navigate to the main menu. Instead of entering your GLACIER record, there should be a separate option about renewing your tax treaty documents.
- How do I submit my renewed tax treaty forms to the University Payroll Office?
Once you have generated your tax treaty renewal forms through GLACIER, you should print them, sign them, and send them to the Payroll office through inter-campus mail (addressed to GLACIER Administrator, Box 278893). If needed, you can drop them off with ISO during business hours and ISO can mail them to the Payroll office.
If you generated your renewed tax treaty forms by updating your whole GLACIER record, make sure to also include copies of your I-20/DS-2019, F-1/J-1 visa, and I-94 with your printed documents.
If you generated your renewed tax treaty forms by themselves, without updating your whole GLACIER record, you do not need to submit copies of your immigration documents.
- I got an email about renewing my tax treaty, but I am not currently earning any income from the University of Rochester.
GLACIER will only consider you eligible for a tax treaty if you have indicated in your GLACIER record that you are receiving income from the University of Rochester. If you are not currently earning income, it likely means that you were earning income in the past, reported that in GLACIER, and have not updated your GLACIER record to reflect that you are no longer earning income.
For example, many students participate in a Focus Group when they first arrive at the University. This Focus Group is a 1-hour job that students are paid for. If you participated in a Focus Group, you should have reported in your GLACIER record that you were earning income, which was correct at the time.
If you are not currently earning income, you can update your GLACIER record to reflect this. Once you have done so, you will no longer be eligible for a tax treaty and you can submit your updated forms (without tax treaty documents) to the University Payroll Office.
If you later get an on-campus job or are otherwise paid by University of Rochester, you can update your GLACIER record to reflect that you are once again receiving payments.
- My friend got an email about renewing a tax treaty, but I did not!
This could be for a few different reasons. It may be the case that your friends are currently eligible for tax treaties and you are not, based on some difference in country of citizenship/tax residency, immigration status, US tax residency status, or type of income.
If you are sure you are eligible for a tax treaty and did not get an email, it may be that you did not accept the tax treaty in GLACIER when prompted, meaning that the tax treaty is not currently applied to you. If you do want to accept the tax treaty, you can do this by returning to your GLACIER record, navigating to the page where you are asked about the tax treaty, and selecting “Yes” to claim it.
If you are sure you are eligible for a tax treaty and are sure that you accepted the treaty through GLACIER, but did not get an email, it may be the case that your specific tax treaty forms do not need to be renewed at this time. It may also be the case that the email got lost in your inbox or sent to the wrong email. To check on this, you can log into GLACIER and check the main menu to see if there is an option to renew your tax treaty documents..
If you have any further questions about tax treaties, please email glacier@hr.rochester.edu