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Paying back taxes (J1, UK tax treaty 20A)

Paying back taxes (J1, UK tax treaty 20A)

Old Sep 27th 2009, 2:10 am
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Default Re: Paying back taxes (J1, UK tax treaty 20A)

Originally Posted by jclarke View Post
Thanks caleyjag and bdobke for posting your experiences!

I would be very interested in hearing how this works out overall. I will hopefully be in a similar situation next year, leaving a post-doc position for a non-J1 position.
Cool. I will let you know if I find out that the information IRS gave me was in the end incorrect.

See if you can go to Britain inbetween for a bit. I'm not sure if that's the reason I got away with it.

Also, what visa are you planning to go for? It's not straightforward.
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Old Oct 29th 2009, 3:53 am
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Default Re: Paying back taxes (J1, UK tax treaty 20A)

Originally Posted by caleyjag View Post
Also, what visa are you planning to go for? It's not straightforward.
I am not sure I follow what you mean by "not straightforward".

The visa would most likely be a H1b as O is out of my league!
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Old Oct 29th 2009, 4:12 am
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Default Re: Paying back taxes (J1, UK tax treaty 20A)

Originally Posted by jclarke View Post
I am not sure I follow what you mean by "not straightforward".

The visa would most likely be a H1b as O is out of my league!
Fair enough. The normal problems with the H1b (lottery and wait*) don't really apply right now anyway.

*actually, I'm really not sure how the timescales for H1b employment are working these days.
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Old Oct 29th 2009, 4:14 am
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Default Re: Paying back taxes (J1, UK tax treaty 20A)

Originally Posted by caleyjag View Post
Fair enough. The normal problems with the H1b (lottery and wait*) don't really apply right now anyway.

*actually, I'm really not sure how the timescales for H1b employment are working these days.
I hope that is the case but I guess I'll have to wait and see. However, it is orthogonal to the taxes issue
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Old Oct 29th 2009, 5:07 pm
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Default Re: Paying back taxes (J1, UK tax treaty 20A)

"He said that provided that I leave the US and return under a different visa I have fulfilled my tax treaty exemption conditions and will not have to pay backtaxes. He said the return to the UK could be as short as one day (!) provided I come back under a different visa."

This is also my reading of the tax treaty. caleyjag, I think I might have PM'd you about this a long time ago (maybe???). I don't envy you your tax return for 2009 though. Presumably you can file as non-resident for the first part of 2009 and resident for the latter part. You should be able to apply the treaty to the non-resident part and then pay normal tax on your income when you returned in the resident part. If the IRS do not like this then you will know that the interpretation of the tax treaty was wrong (by the agent you spoke to). You should have a good argument that you called and tried to verify the correct ruling on this to avoid penalties.

Cheers,
Sam

Edit - on second thoughts, if you pass the substantial presence test you may have to do the whole thing as resident.

Last edited by SamuearlJackson; Oct 29th 2009 at 5:14 pm.
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Old Oct 29th 2009, 6:24 pm
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Default Re: Paying back taxes (J1, UK tax treaty 20A)

Originally Posted by SamuearlJackson View Post
"

Edit - on second thoughts, if you pass the substantial presence test you may have to do the whole thing as resident.
Yes, I am stuffed on the substantial presence test.

The tax return will be an interesting one. I suppose I just claim exemption on the J1 part, pay the full on the current O1 part, stick a cover letter in with it and then sit back and hope for the best! I bumbled my own way through the last couple of tax returns but I'm definitely going to get professional help for this one.

Whatever happens, I'm emotionally ready to get bent over by the IRS next year, so it's all good.

We'll see what happens.

Last edited by caleyjag; Oct 29th 2009 at 6:26 pm.
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