Which form to submit W-4 or Form 8233 as a NRA on F1-OPT?

[user17553787901]

I am an NRA on F1-OPT and started working as full time employee. I am eligible for tax treaty benefits under Article 21(2); however my new company has not considered it. They have asked me to submit Form W-4, which has NRA marked at step 4(c).

My question is :

1. Do I need to submit Form 8233 instead of W-4? My employer says form 8233 is only for independent contractors and not applicable to me since I am full-time employee.

2. Is there a different correct way to have the employer correctly consider tax treaty benefits?

Which form to submit W-4 or Form 8233 as a NRA on F1-OPT?

[pk]

@user17553787901 , first we  need a few bits of info ( to be able to focus the answer  to your situation).

(a) When fid you enter this country with F-1 ---- trying to understand whether you are still in or out of exemption period ?

(b) Which country are you from --- need to see the exact wording of the tax treaty ?  Many treaties  allow for an exclusion from US Tax of a fixed amount.  Thus form 8233 may not be applicable 

(c) If you are still in the exempt, you will have to file form 8843.   And of course  if you are NRA  at any point during the year ( depending on exact facts and circumstances ), you may have to file 1040-NR  ( Not supported by TurboTax --- use SprinTax or similar ) or dual status  ( 1040 + 1040-NR).

(d) During OPT, you are exempt from FICA

(e) Note even during  OPT you are not an employee but a trainee -- there are differences for tax purposes ( FICA/ vacation/overtime-pay etc.etc. )

(f) Do not understand whereon form W-4 you entered NRA -- 4c is for extra withholding.

I will circle back once I hear from you --yes ?

[user17553787901]

Hello @pk 

Thanks! Please see below my responses:

a) Still within 5 years exemption

b) Country - India. Treaty article - Article 21(2)

c) 1040-NR + 8843 is what I have used in last year filing. This is fine. The question is more on withholding tax documents needed by employer.

d) FICA exempt is known

e) 
f) Employer uses ADP. On providing Non-resident Alien, step 4c was auto populated as Non-Resident Alien

The main query is whether I need to submit Form 8233 to claim the $15,000 deduction under Article 21(2) or do I need to mark it as deduction under point 4(b) of W-4. Or both approaches are wrong and there is a different correct approach?