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Are you sure they are tax free ? If they are then they should not be on box 1 of the W-2 ... a corrected form should be issued ... https://www.irs.gov/individuals/international-taxpayers/allowances-differentials-and-other-special-p....
Please explain what you mean by a living allowance and why you think it should not be taxed. There are several possibilities and we can’t really provide answers without more details.
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