>
Date: Mon, 16 Apr 2001 16:36:27 -0400
X-Mailer: Internet Mail Service (5.5.2650.21)
At the end of the first page of Publication 901 (tax treaties) is stated:
Disclosure of a treaty based position that reduces your taxes:
"If you take the position that any U.S. tax is overruled or otherwise
reduced by a U.S. treaty (a treaty-based position), you generally must
disclose that position on your affected return".
Based on this statement to prove that you are on the treaty you would need
to fill out 3 forms (in addition to 1040-NR) and you can also claim :
"Closer connection to a second country", which further proves that your main
residency is not the US, but Switzerland, it helps also if you still have an
account, and/or still pay some taxes in CH,....
The 4 total forms are :
8833 Treaty-based Return Position Disclosure Under Section 6114 or
7701(b) and in addition you need to file a statement explained at
the end of booklet 519.
8843 Statement for exempt Individuals
8840 Closer Connection Exception Statement for Alien.
8233 Exemption from Withholding on Compensation for Indipendent (and
certain Dependent) Personal Services of a non-resident Alien Individual
I filled out all this forms and I did not attach any of the statments from
my fellowship. All the info's were all there in the forms.
I had been in the US for 6 years on an F-1 student visa, during which I had
filed as resident for 4 previous years (US paid salary), but in my last year
on the F-1, I had graduated and was a Postdoc with a felloship from the SNF,
so I claimed as non-resident and the closer connection (1996). The same I
claimed a year later, when I was payed 50:50 by my Postdoc advisor in CA and
the SNF, while on the J-1 visa.
During that year (1997) I was not shure if I was a resident or not (at that
time I had been in the US for 8 years), so I called the IRS-representative
at the American Embassy in Paris, which answers all the tax related problems
of the American trapped French, Swiss and Austrian. He was very helpful and
of course he was an expert in my problems: he reassured me that I was not a
resident and faxed me a page of the US-Switzerland treaty. I highly
reccomend him, you can find his fax or tel number on the webb page of the
American Embassy in Paris.
I know that the US-Switzerland Treaty has been upgraded in 1998, and several
things have changed to the worse for the postdocs, but still if you read
properly booklet 901, 519 and the Swiss-US treaty (on the webb page of the
Swiss Embassy in Washington DC) you can gain insight into the mess and save
quite a bit of money!! Just do your research well, it took me in 1997 about
3 weeks, but with the old treaty I was able to even get back the taxes from
my american paid salary, which is now impossible!!
CG
By the way; keep all your tax-returns for a while: the IRS can audit someone
for 3 years, but if they smell fraud they can audit up to 7 years!
-----Original Message-----
From: Stephen Helliwell [mailto:stephenh_at_mit.edu]
Sent: Monday, April 16, 2001 2:07 PM
To: Eastcoast_at_swiss-list.com
Subject: eastcoast: Re: swiss-list: Summary: tax issues
I cannot help but throw some more info onto the pile. In IRS
information book #519 at the bottom of page 5 and the top of page 6
it explains that if you are here as a teacher or trainee, for 3 years
or less, and all your salary from those three years is non US, then
you are still exempt - because you CAN exclude all of these days from
the substantial presence test.
As usual, do not take my word for it, download this 55 page baby from the
IRS.
http://www.irs.gov/forms_pubs/pubs.html
Have fun, you only have a few hours to go !!
Stephen
>On 16 Apr 01, at 9:57, Balthasar Bickel wrote:
>
>> Thank you so much everybody for their generous advice! Here's the
>> summary of what I found out from people's responses to my query, from
>> the UC Berkeley International Scholars Services, and from direct
>> information from the IRS (yes, they call you back when you leave a
>> message -- even now! -- and they do know about things!):
>
>Just my $0.02 to the matter below, the usual disclaimers apply (e.g.
>it's your fault).
>
>> There are two important things to know:
>>
>> 1. As Ursula points out, you become a resident alien after two years of
>> presence ONLY if your salary comes from within the US. So, SNSF
>> fellowship holders continue to qualify as nonresidents in their third
>> year of presence!
>
>Huh?
>
>For Federal Taxes, you qualify as a resident alien either if you are
>a. a lawful permanent resident (Green Card)
>b. meet the substantial presence test.
>
>The substantial presence test is met if:
>- individual present in the U.S. for at least 31 days in current year
>AND
>- current year U.S. days plus 1/3 prior year U.S. days, plus 1/6
>second prior year U.S. days equals or exceeds 183 days.
>
>Where your salary comes from has no influence on the presence test.
>
>Non-Residents pay taxes on U.S. Employment income and on
>foreign income while present.
>
>Residents pay taxes on all foreign employment income and all U.S.
>employment income and all foreign passive income. Foreign income
>taxes can be used as a credit.
>
>(The info is taken straight from slides from Ernst & Young)
>
>> 2. For those of you who qualify as resident aliens nevertheless,
>> salaries and other renumeration from Swiss Government agencies are
>> tax-exempt under the current Tax Treaty.
>
>Note that the State of California doesn't honor tax treaties.
>
>> I take no responsability for the correctness and accuracy of this
>> information. When in doubt, call the IRS at 1-800-829-1040!
>
>Good choice :-)
>
>Cheers,
>-daniel
>
>--
>Daniel Kluge / Program Manager - TIBMercury Online
>TIBCO Finance Technology Inc. Phone +1-650/461-3000
>3375 Hillview Avenue Fax +1-650/461-3003
>CA 94304 Palo Alto, USA Direct +1-650/461-3332
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-- ----------------------------------------------------------------------- Stephen Helliwell Post-Doctoral Fellow Department of Biology MIT 68-553 77 Massachusetts Avenue Cambridge MA02139-4307 USA tel 1 617 253 9838 fax 1 617 253 6622 stephenh_at_mit.edu ----------------------------------------------------------------------- ================================================================= To unsubscribe from the eastcoast mailing list send the message body of "unsubscribe eastcoast" to majordomo_at_swiss-list.com or visit http://www.swiss-list.com/mailings/ ================================================================= To unsubscribe from the eastcoast mailing list send the message body of "unsubscribe eastcoast" to majordomo_at_swiss-list.com or visit http://www.swiss-list.com/mailings/Received on Mon Apr 16 2001 - 13:37:51 PDT
