Georgia Tech is required by the U.S. Internal Revenue Service (IRS) to withhold federal income tax from ALL payments made to (or on behalf of) a nonresident alien. Regulations also require that Georgia Tech report all such payments to the IRS. Therefore, Georgia Tech must review all data related to the immigration status and purpose of their stay of all payment recipients at Georgia Tech who are not U.S. citizens or lawful permanent residents. Determining tax residency and tax treaty eligibility is a complicated and difficult task which is why Global Human Resources at Georgia Tech uses tax compliance software called GLACIER.
2017 Tax Act Impacts Take Home Pay
The tax act passed in December 2017 took away the Personal Exemption from all taxpayers. This increases the taxable income for Nonresident aliens by $4,050 for the year, and therefore slightly increases the income tax withholding in each paycheck. Indian nationals on F-1 visas should expect to see a small decrease in taxes as they are permitted to take the standard deduction on their tax returns, and the standard deduction has been doubled. This did not change the tax treaties between the US and home countries.