What's New For Tax Year 2007
(For Tax Year 2007)
A number of ISSS-BU readers who are familiar with the process for filling out their income tax forms have asked the ISSS to provide information on specifically what has changed, or what is new for Tax Year 2007.
For the third year, the ISSS has purchased a license with CINTAX to allow BU international students, alumni, scholars and faculty to use CINTAX to compute and print the federal income tax forms. CINTAX is a web-based tax preparation system designed exclusively for international students, scholars and faculty who file forms 1040NR or 1040NR EZ as non-residents for tax purposes.
An important item of note is to remind readers of the criteria that determines who qualifies as a non-resident for tax purposes for tax year 2007. F-1 and J-1 students, and their F-2 and J-2 dependents, qualify as non-residents if they have been in the United States in that status since 2003 or later. F-1 or J-1 students who have been in the United States in that status for more than five years (2002 or earlier) are considered to be residents for tax purposes.
J-1 scholars and their dependents qualify as non-residents if they have been in the United States in that status since 2006 or later. J-1 scholars who have been in the United States in that status for more than two years (since 2005 or earlier) are considered to be residents for tax purposes.
The personal exemption deduction (line 13 on form 1040NR EZ, line 38 on form 1040NR) is $3400 for tax year 2007. This amount increases each year.
The standard deduction (used only by students from India as their tax treaty amount) is $5350 for single individuals and those who are filing as "married filing separately" for 2007 on form 1040NR EZ. The standard deduction is $10700 for Indian nationals who are filing as "married filing jointly" for 2007 on form 1040NR. Indian nationals enter the standard deduction amount (line 11 on form 1040NR EZ, line 37 and page 3 line 3 on form 1040NR) instead of their state and local taxes.
There is a new tax treaty with Bangladesh. Students from Bangladesh who are employed, as well as professors and researchers from Bangladesh can now exempt certain amounts of income from tax. See the section on "Tax Treaties" for more information.
There is a tax treaty in effect between Japan and the United States that took effect January 1, 2005. Among the changes brought about by this new tax treaty is that Japanese nationals who are married and/or have children will no longer be able to able to claim an exemption for their spouse and/or dependents. Also, under the new tax treaty, Japanese nationals will no longer be able to claim the $2000 exemption for wages from a U.S. employer. Those who entered the United States on or before March 30, 2004 will be able to claim the wage exemption, but not the dependent exemption.
New York State filers must continue to use New York State form, IT-2 "Summary of Federal Form W-2 Statements" which was introduced two years ago. New York State filers must use the IT-2 to copy over information from the W-2 forms onto this form, and include it with forms IT-203 and IT-203B.