I am a PhD student working abroad, do I need to file my taxes?

Forum|Forum|5 years ago
October 26, 2020
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Best,

I am a PhD student working abroad in a country which has a tax treaty with the US (Belgium). I recently learned that I may indeed be required to file taxes, even though I do not make enough to be taxed by the U.S. I am a bit confused, because my "stipend" is not considered tax-eligible income by Belgium. I am also married to a Belgian citizen with no financial association to the U.S. He does not have a green card and he has never worked in the U.S.

My questions are:

Do I even need to file taxes?

If so, how do I go about filing my taxes from my past 3 years of being a PhD student?

What are the tax implications for my husband? I've read that I need to mark my file as married, separate. Is that all I need to do?

Thank you!

Opus 17

Employee

Any US person (citizen or permanent resident, greed card holder) is required to file a US tax return and pay US income tax on all their worldwide income, even if they also file a tax return in the country where they are living. (This is part of the price of having the benefits of US citizenship.) If you also paid taxes on the same income in the country where you are living, the IRS will give you a deduction or credit for foreign taxes paid so you don't get double-taxed.

Your Belgium income will be taxed by the US according to US law the same as if you received the same kind of income for working in the US. In this case, a PhD stipend is considering training or education, so it is subject to regular income tax but not self-employment tax. You also get the benefit of any deductions you qualify for, like the standard deduction. In Turbotax, it would be entered as "other income".

If married, you must file either as married filing separately or married filing jointly. If you file jointly, you have to declare your spouse's income and pay US tax on it, so you probably don't want to do that. When you file, you need to write "NRA" (non-resident alien) in the space for your spouse's social security number.

You could purchase Turbotax for 2017, 2018 and 2019 online here, go to the bottom of the page and click the link for "products for previous tax years." You can use the cheapest version available (Deluxe or even Basic) since you don't need a state tax return. You will have to print and mail the returns since you can't e-file older years and e-filing for 2019 is closed.

You could also just download the tax forms and instructions for each year and do it by hand.

If your stipend was less than $12000 for 2018 and less than $12,200 for 2019, you don't owe taxes on the income and don't have to report it. For 2017 the threshold was $10,400.

If you do owe taxes, you can expect that after you pay the taxes, the IRS will send you a bill for late fees with interest and possibly a penalty. You can request a waiver of the penalty under either the first time rule or the reasonable cause rule. (The interest can't be waived but it will be recalculated if the penalty is removed.)

https://www.irs.gov/businesses/small-businesses-self-employed/penalty-relief