The table below indicates which countries have tax treaties with the United States in which some, or all, student wages are tax exempt, provided certain conditions are met.
If a student’s country of residence is included in the table below and the criteria in Column B and Column C are met, wages qualify for a tax exemption, and the following tax form needs to be completed upon hiring:
Form 8233: Exemption from Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual.
If a student’s country of residence does not appear in the table below, Form 8233 does not need to be completed.
Description of Table Columns
Column A: Students’ country of permanent citizenship. This is used in completing Form 8233 line 12c.
Column B: Maximum length of exemption. After the maximum number of years in the United States has been reached, the individual is subject to federal tax withholding.
Example: A student from Egypt has $2,000 of student wages but has been in the United States for six years. The $2,000 is subject to taxation because the student has been in the United States over the five-year limit.
Column C: Maximum earnings for exemption. The information in Column C is used for completing Form 8233 line 12b. Earnings above the annual maximum per year are subject to taxation. The one exception to this condition is for Canada. Wages below the $10,000 threshold are exempt. However, if wages exceed $10,000, the entire amount is taxable and not just the amount that exceeds $10,000.
Canada Example: A student from Canada earns $12,000. Because it exceeds the $10,000 threshold amount, the entire $12,000 is taxable.
Other Example: A student from China has student wages of $6,000. Because the tax treaty exempts up to $5,000, only $1000 will be subject to federal taxation.
Column D: The tax treaty article citation. This is used in completing Form 8233 line 12a.
Tax Treaty Table for Student Wages
|
Column A |
Column B |
Column C |
Column D |
|
Country of |
Maximum Presence |
Maximum |
Treaty Article |
|
Bangladesh |
No Limit |
$8,000 |
21(2) |
|
Belgium |
No Limit |
$9,000 |
19(1)(b) |
|
Bulgaria |
No Limit |
$9,000 |
19(1)(b) |
|
Canada |
No Limit |
$10,000 |
XV |
|
China, People’s Republic |
No Limit |
$5,000 |
20(c) |
|
Cyprus |
5 years |
$2,000 |
21(1) |
|
Czech Republic |
5 years |
$5,000 |
21(1) |
|
Egypt |
5 years |
$3,000 |
23(1) |
|
Estonia |
5 years |
$5,000 |
20(1) |
|
France |
5 years |
$5,000 |
21(1) |
|
Germany |
4 years |
$9,000 |
20(4) |
|
Iceland |
5 years |
$9,000 |
19(1) |
|
Indonesia |
5 years |
$2,000 |
19(1) |
|
Israel |
5 years |
$3,000 |
24(1) |
|
Korea, South |
5 years |
$2,000 |
21(1) |
|
Latvia |
5 years |
$5,000 |
20(1) |
|
Lithuania |
5 years |
$5,000 |
20(1) |
|
Malta |
No Limit |
$9,000 |
20(2) |
|
Morocco |
5 years |
$2,000 |
18 |
|
Netherlands |
No Limit |
$2,000 |
22(1) |
|
Norway |
5 years |
$2,000 |
16(1) |
|
Pakistan |
No Limit |
$5,000 |
XIII(1) |
|
Philippines |
5 years |
$3,000 |
22(1) |
|
Poland |
5 years |
$2,000 |
18(1) |
|
Portugal |
5 years |
$5,000 |
23(1) |
|
Romania |
5 years |
$2,000 |
20(1) |
|
Slovak Republic |
5 years |
$5,000 |
21(1) |
|
Slovenia |
5 years |
$5,000 |
20(1) |
|
Spain |
5 years |
$5,000 |
22(1) |
|
Thailand |
5 years |
$3,000 |
22(1) |
|
Trinidad and Tobago |
5 years |
$2,000 |
19(1) |
|
Tunisia |
5 years |
$4,000 |
20 |
|
Venezuela |
5 years |
$5,000 |
21(1) |