The U.S. has income tax treaties with many foreign countries. Tax treaties provide residents of foreign countries with reduced tax rates or exemptions from U.S. income tax on certain items of income received from sources within the U.S. The tax treaty benefits vary by country and income type.
A reduced U.S. tax rate or exemption may apply to you if there is a tax treaty between the U.S. and your home country and may be applicable to both federal tax and state tax. You must renew claimed tax treaty benefits annually.
Sprintax Tax Determination System (TDS)
VPF HR/Payroll uses the Sprintax Tax Determination System (TDS) to help foreign national students and scholars determine their U.S. tax status (nonresident alien vs. resident alien). Sprintax TDS can also determine if you are exempt from paying U.S. tax due to your home country’s tax treaty with the U.S.
Tax Treaty Exemption
Sprintax TDS will determine your U.S. tax residency status and your eligibility for a tax treaty based on the information you enter about your presence in the U.S. Sprintax TDS will generate tax forms (e.g. W-4, 8233, W-8-BEN) for you to submit to VPF HR/Payroll (firstname.lastname@example.org). VPF HR/Payroll will use these forms to determine how much money to deduct from your pay for taxes and process your tax treaty coverage, if applicable. Please note that these tax forms are not the same as the individual income tax returns you are responsible for submitting annually.
Sprintax TDS will ask for your Social Security number (SSN) in order to generate a tax treaty document. You will need to complete your Sprintax TDS profile even if you do not have a Social Security Number (SSN).
These tax-related documents are needed by VPF HR/Payroll in order to administer your pay correctly and in accordance with applicable laws and treaties.
VPF HR/Payroll Assistance
A VPF HR/Payroll tax specialist holds virtual office hours on Tuesdays and Thursdays from 10:00 am through 4:30 pm to help international students, faculty, researchers, and staff determine their U.S. tax status.
Log in to Atlas—MIT’s self-service and administrative systems hub—to book these appointments online. See the Atlas Full Catalog menu on the left. Choose Atlas Service Center In-person Services, then Tax Treaty Guidance, to book appointments at the Atlas Service Center.
Additional IRS Resources
IRS Publication 901 will also help you determine whether a tax treaty between the U.S. and your home country offers a reduced rate of, or possibly a complete exemption from, U.S. income tax for residents of that country. The IRS website contains full text of tax treaties, technical explanations, and protocols. The IRS tax treaty tables provide a summary of different income types and withholding tax benefits received under a treaty.
The content in this website is provided for informational purposes only. MIT does not offer legal, accounting, or tax advice and services. This information should not be used as a substitute for consultation with a professional accounting, tax, or legal advisor. MIT recommends that students consult a tax advisor for individual tax advice.