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International Taxpayers

 

World Map ImageThe Tax Clinic provides a number of services to nonresident aliens in the community and throughout the state of Michigan.  Whether you are an international student, a seasonal farmworker or a temporary worker in the United States, we can assist you with understanding and complying with U.S. tax laws.  This includes interpreting and claiming tax benefits under U.S. international tax treaties.   If you are a resident alien or U.S. citizen,
please contact the Volunteer Income Tax Assistance (VITA) program for a VITA site near you.

Getting an Individual Taxpayer Identification Number (ITIN)

An ITIN, or Individual Taxpayer Identification Number, is a tax processing number only available for certain nonresident and resident aliens, their spouses, and dependents who cannot get a Social Security Number (SSN). It is a 9-digit number, beginning with the number "9", formatted like an SSN (NNN-NN-NNNN).

To obtain an ITIN, you must complete IRS Form W-7, IRS Application for Individual Taxpayer Identification Number (PDF) . The Form W-7 requires documentation substantiating foreign/alien status and true identity for each individual. You may either mail the documentation, along with the Form W-7, to the address shown in the Form W-7 Instructions, present it at IRS walk-in offices, or process your application through a Certified Acceptance Agent authorized by the IRS. Form W-7(SP), Solicitud de Número de Identificación Personal del Contribuyente del Servicio de Impuestos Internos (PDF) is available for use by Spanish speakers.

Certified Acceptance Agents are entities (colleges, financial institutions, accounting firms, etc.) who are authorized by the IRS to assist applicants in obtaining ITINs. They review the applicant's documentation and forward the completed Form W-7 to IRS for processing.   

Types of Income Reporting Documents & Statements

By Mostafa Shanta
Posted: 3/24/2021; Updated: 5/2/2022

When preparing your tax returns for filing, taxpayers need to first collect all of the tax statements they received in the spring for that tax year. Because income encompasses many kinds of payments and comes from many different sources, various forms are used to record a taxpayer’s income. These tax statements also include instructions on the back and describe any letter or number codes that may be used in the tax statement. The following is a list of the most common income statements a taxpayer may receive.

Form W-2 
A W-2 is an income statement that the taxpayer receives from their employer. It shows how much the taxpayer earned in 2020 and how much federal, state, and local income tax has been withheld from those wages by the employer. While all W-2s may not look alike, there is uniformity in the information found in the boxes. For instance, Box 1 will always contain the total wages earned that year.

Form 1042-S
A Form 1042-S is an income statement showing income (including scholarships) paid to a foreign person in the relevant tax year. The taxpayer should receive this form from the party who is the source of the wages or scholarships. Usually, an educational institution (like a university) or a financial institutional (like a bank) will send the foreign taxpayer this form.

Form 1099-B
A Form 1099-B is reported by brokerages and barter exchanges to record the taxpayer’s gains and losses from selling stocks and other securities during the tax year. Each transaction is recorded on a separate 1099-B. The taxpayer should receive these forms from his broker, though some brokers do have an online site from which the 1099-Bs may be retrieved. If the financial institution is required to report more than one 1099 to a taxpayer (i.e., 1099-B, 1099-INT, and a 1099-DIV), they may send you a “Consolidated 1099” that includes information for multiple 1099’s on one document.

Form 1099-DIV
A Form 1099-DIV is sent out by banks or other financial institutions to taxpayers who received dividends and distributions from their investments during the tax year. Certain investment accounts are exempt from issuing a 1099-DIV (namely an individual retirement account, which have a separate form for their distributions). Banks and financial institutions are not required to send 1099-DIV if the total amount in dividends is not greater than $10.

Form 1099-G
A Form 1099-G is a form used by a government agency reporting income paid to the taxpayer for the tax year. It mainly reports state unemployment payments or state/local tax refunds. The state or local government should mail the form to the taxpayer. If it was not received, the taxpayer should contact the relevant government agency to get a copy.

Form 1099-INT
A Form 1099-INT shows how much bank or credit union interest you earned that tax year. Note that while credit unions refer to interest as dividends, the information is provided on a 1099-INT, not a form 1099-DIV. You may receive this by mail, but some banks and credit unions may require you to retrieve it from their website or request it. If it is less than $10, the bank or credit union is not required to report it.

Form 1099-MISC
A Form 1099-MISC shows any miscellaneous income that may have been receive from your employer or another party. Before 2020, the 1099-MISC was the form that businesses usually used to pay independent contractors and other non-employees.

Form 1099-NEC
A Form 1099-NEC is the form, beginning 2020, self-employed individuals will receive from businesses that has paid them more than $600 for their work. Self-employed individuals include independent contractors and gig workers. If you believe you should have received a 1099-NEC from a particular business, you should contact them.

Form 1099-R
A Form 1099-R is used to report a distribution of $10 or more form a retirement savings or investment account. You should receive the form from the party responsible for sending the distribution.