Taxes

Federal, State, and Local Taxes

All InterExchange students must pay federal, state and local taxes. Students are not exempt. While they are here, students of the InterExchange Work & Travel USA program are exchange visitors in the non-resident alien tax category. Please consult a tax professional for the most recent tax regulations.

FICA and FUTA Withholdings

Under IRS Code Section 3121 (B)(19), all non-resident aliens on J-1 Visas are exempt from paying FICA (Social Security) and FUTA (federal unemployment taxes) taxes during their first two calendar years in the U.S. Since all of our students are only able to work for four months, all are exempt from these withholdings. Please consult a tax professional to see if students are exempt from state unemployment taxes in your state.

Completing the W-4 Form

All students must fill out a W-4 (employee withholding allowance certificate).

Recommendations From the IRS

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. Please urge them to file a tax return after they receive their W-2!

Filing a Tax Return

All students are required to file for U.S. income tax by April 15 of the year following the year in which they work. To file for a federal tax return, students will fill out and send a 1040-NR (non-resident aliens with no dependents) tax form along with copies of their W-2 forms. Students can obtain the 1040-NR and instructions from the IRS website. Refund checks are mailed to students in their home countries. If your students have any questions regarding the process, they can view our participant resource page on filing tax returns.

W-2 Forms

Please send W-2 forms to students at their permanent addresses in their home countries. We recommend that you have students address envelopes with their permanent addresses at the time you have them fill out their W-4. For IRS publications please contact your local IRS office or download them on the IRS website. IMPORTANT: Do not send W-2 forms to the InterExchange New York office. InterExchange is not responsible for sending this information to students.