J1 research scholar in third year - how to do taxes

[seballos]

Hi,

I lived in the US from July 2017 to August 2019 with a J1 Visa, and worked for a non-profit research organization during this time. I have been married the whole time.

The first two calendar years (2017 and 2018) I filed my federal and state taxes with Sprintax without any issues. I always paid federal and state taxes because non-profit research organizations do not benefit from the tax treaty. I had to file as single.

In the last month of my contract only, I paid FICA taxes (Social security and Medicare) as my exemption as non-resident alien ended after two years, so I paid only a small amount of FICA taxes.

First question: am I supposed to pay FICA taxes for the whole year?

For 2019, Sprintax tells me I should use Turbotax because I am a resident alien. Turbotax doesn't ask anything about my J1 or visa status.

Second question(s): Can I just use turbotax as a normal resident? Since I am married, can I file jointly? my wife hasn't worked in 2019, so it is easy to include her, if possible. Do I get standard deduction for being married?

Thanks a lot!

[KurtL1]

As to your first question, under IRC Section 3121(b)(19) payees in a F-1, J-1, M-1, Q-1 or Q-2 non-immigrant visa status are not subject to FICA. IRC 3121

As to your second question, under a F-1 Visa you were unable to count the days present in the United States for any part of five calendar years toward meeting the Substantial presence test. Since you entered the U.S. in 2017 as of January 1, 2022 the five year limitation will be met, if you continue with a J-1 Visa.  If you change your visa status to one other than J, F, M, or Q you would be able to start counting days at that time.

In 2019 you are still considered a Non Resident Alien for tax purposes. You are unable to file a Form 1040 but must us Form 1040NR.

If you wife is under the same visa status, in 2019 she would also be required to file Form 1040NR

[KurtL1]

If you worked a teacher or trainee with a J-1 Visa, you will be able to start counting days present in the U.S after two (2) calendar years. You would be eligible to start counting days January 1, 2019. If you meet the 183 day test under the  Substantial presence test you would be considered a Resident Alien for tax purposes and be eligible to file Form 1040. 

Since you are married you would eligible to file with the Married Filing Status when filing your taxes for 2019 tax year. You would include your wife even though she has not worked in 2019.

[seballos]

Hi Kurt, 

Thank you for your answer.

I was a research scholar, which I believe can be considered a trainee and is usually able to count days after 2 calendar years.

I am thus a resident alien for 2019. I left the US in August 2019, and I started a new job in Portugal in November. Am I still a resident alien for 2019? Am I considered a resident alien for the whole year? Should I include my salary in Portugal in my Tax return to the US IRS?

[KarenJ2]

Yes, you are a resident alien for 2019.  In, 2019. your last year of residency in the US, your residency termination date is December 31, 2019.  You will need to file a resident 1040 return and include your worldwide income including your wages in Portugal.

You are allowed to claim a foreign tax credit on the US tax return for the taxes you paid in Portugal or if you did not pay any foreign taxes in 2019, you can claim the amount of foreign taxes that accrued in November and December.  This credit will help you offset any double taxation.

Please see IRS Publication 519, page 8, Last yea of Residency.  US Tax Guide for Aliens