Important Tax Information
U.S. law requires that you pay federal, state, and local taxes. Generally, your employer will deduct money from your paycheck every pay period. As an income-earning individual, you will be taxed on income from salaries, wages, and tips. Your employer will submit the amount withheld directly to the federal government. Deductions for state and local taxes will vary. Some states do not have a personal income tax; others may tax income as much as 8%. Similarly, local taxes will vary but will be significantly less. If no taxes are withheld from your pay, please contact InterExchange.
You do pay:
- Federal income tax
- State income tax
- Local or city income tax
You do not pay:
- Social Security (S.S.)
- Medicare tax (FICA)
- Federal Unemployment Tax (FUTA)
If you see deductions that say FICA, FUTA, S.S. or Social Security, please notify your employer promptly. If your employer is unable to issue a refund, contact the Internal Revenue Service Center and request IRS Form 843 Claim for Refund and Request for Abatement. You will need to submit the completed IRS forms to the Internal Revenue Service Center. Please note: some states may deduct state unemployment taxes, which you are required to pay.
Form W-4
As an Exchange Visitor on a J-1 Visa, you are considered a “Non-Resident Alien” for tax purposes. When filling out the current W-4 form it is recommended that InterExchange Work & Travel USA participants follow Supplemental Form W-4 Instructions for Nonresident Aliens as provided by the IRS.
Depending on how long you work and how much money you earn, you may be eligible for a refund. You should give your employer a self-addressed envelope with your home country address so that they can mail you your tax forms later. InterExchange staff are not tax professionals. If you have tax questions, please consult a tax professional.
How to Read Your Pay Stub
In order to make sure that you are paying the correct taxes, check your first pay stub:
How to understand your Pay Stub
Gross Pay: Total amount earned in the pay period before any tax deductions.
Withholdings: Amount of money the Federal, State and local governments take out of your paycheck
Net Pay: Total amount of earnings you will receive after taxes have been taken out.
YTD or Year To Date: The total amount of earnings and withholdings since January 1st of the current calendar year.
Please Note:
Before you end your program please give your employer your home address or a self-addressed envelope so that they can mail your W-2 Form to you. If you don’t do so, your employer will not be able to send you the necessary forms to file for your tax return.
