Form 1040NR-EZ (2014) Filing Guide for Nonresident Aliens

The Internal Revenue Service designed this simplified return for individuals whose only effectively connected income derives from wages, salaries, tips, state and local income tax refunds, scholarship or fellowship grants, and nontaxable interest or dividends.

Determining Nonresident Alien Status

Your tax status depends on the green card test and the substantial presence test, as outlined in

IRS Publication 519. You qualify as a nonresident alien if you did not hold a green card at any time during 2014 and did not meet the substantial presence test for the tax year.

The substantial presence test requires physical presence in the United States for at least 31 days during 2014 and 183 days during the three-year period that includes 2014, 2013, and

2012, using a weighted formula that counts all days in the current year, one-third of the days in the first preceding year, and one-sixth of the days in the second preceding year

Specific individuals qualify as exempt individuals who do not count days of presence for the substantial presence test. These categories include foreign government-related individuals, teachers or trainees temporarily present under J or Q visas, students temporarily present under

F, J, M, or Q visas, and professional athletes temporarily competing in charitable sports events.

Income Reporting Requirements and Form Eligibility

Form 1040NR-EZ restricts filers to reporting only specific types of U.S. source income. Line 3 captures wages, salaries, and tips from effectively connected employment, with amounts typically matching the amounts reported in box 1 of Form W-2.

Line 4 reports taxable refunds, credits, or offsets of state and local income taxes received during

2014. Line 5 includes scholarship and fellowship grants, though amounts used for tuition, fees, books, supplies, and equipment may be excludable if you were a degree candidate. Line 6 reports income exempt from U.S. tax under treaty provisions, including both effectively connected income and income not effectively connected with a U.S. trade or business. Line 7 totals your effectively connected income by adding lines 3, 4, and 5.

Treaty Benefits and Required Documentation

You must complete Schedule OI, item J on page 2 of Form 1040NR-EZ to claim treaty benefits.

The schedule requires the treaty country name, applicable treaty article, number of months claimed in prior tax years, and the amount of exempt income.

Adjustments, Deductions, and Exemptions

Line 8 allows you to exclude scholarship and fellowship grants used for qualified tuition and course-related expenses, but only to the extent these amounts were included on line 5. Line 9 permits a student loan interest deduction if you paid interest on a qualified student loan during

2014, your filing status is single, and your modified adjusted gross income falls below $80,000.

Line 10 calculates your adjusted gross income by subtracting lines 8 and 9 from line 7. Line 12 subtracts your itemized deductions from your adjusted gross income before applying your personal exemption.

Line 11 allows itemized deductions, but Form 1040NR-EZ restricts these deductions to state and local income taxes only. Residents of India who were students or business apprentices may claim the standard deduction instead of itemizing state and local income taxes under specific treaty provisions.

Line 13 provides your personal exemption amount of $3,950 for 2014, subject to phase-out if your adjusted gross income exceeds $152,525. Line 14 calculates your taxable income by subtracting line 13 from line 12, representing the amount subject to federal income tax.

Tax Calculation and Payment Credits

Line 15 determines your tax liability using the tax table provided in the form instructions. Your taxable income from line 14 and filing status determine which column to use in the tax table.

Line 16 captures unreported Social Security and Medicare tax from Form 4137 or Form 8919 if applicable. Line 17 adds lines 15 and 16 to calculate your total tax liability for the tax year.

Federal income tax withholding appears on two separate lines to distinguish source documents.

Line 18a reports federal income tax withheld from Form W-2 and Form 1099-R, while line 18b captures federal income tax withheld from Form 1042-S.

Line 19 includes estimated tax payments you made during 2014 and any amount you applied from your 2013 tax return. Line 20 allows credit for amounts paid with Form 1040-C, the

departing alien income tax return filed when leaving the United States. Line 21 totals your payments by adding lines 18a through 20. Line 22 calculates any overpayment if your total payments exceed your total tax liability.

Refunds, Amounts Owed, and Filing Procedures

Line 23a allows you to request a refund of your overpayment, with the option to have it deposited directly into a checking or savings account. Line 24 permits you to apply part or all of your overpayment to your 2015 estimated tax if you anticipate owing estimated tax for the following year. Line 25 shows the amount you owe if your total tax exceeds your total payments.

Line 26 calculates any estimated tax penalty if you failed to pay sufficient estimated tax during

2014.

Filing Deadlines and Submission Address

You must file Form 1040NR-EZ by April 15, 2015, if you received wages as an employee subject to U.S. income tax withholding. The filing deadline extends to June 15, 2015, if you did not receive wages subject to withholding.

Mail your completed return to the Department of the Treasury, Internal Revenue Service, Austin,

TX 73301-0215 USA. If you enclose a tax payment, mail your return to the Internal Revenue

Service, P.O. Box 1303, Charlotte, NC 28201-1303 USA.

Form 4868 provides an automatic six-month extension of time to file your return if you cannot meet the original deadline. You must file Form 4868 by the regular due date of your return. An extension of time to file does not extend the time to pay your tax liability, and you will owe interest on unpaid tax from the original due date. The Internal Revenue Service calculates interest from the original filing deadline, regardless of whether an extension was approved.

Common Restrictions and Additional Reporting

Form 1040NR-EZ prohibits several deductions and credits available on other tax forms. You cannot claim dependent exemptions, tax credits for education expenses, child tax credits, or earned income credits when using this simplified form.

You cannot deduct contributions to individual retirement arrangements or claim the foreign tax credit. If you need to claim any of these items or report income types not permitted on Form

1040NR-EZ, you must file Form 1040-NR instead.

Income from 1099-MISC forms reporting nonemployee compensation must be evaluated to determine whether it represents effectively connected income from services performed in the

United States. Treaty benefits may apply to certain types of income, reducing or eliminating U.S.

tax liability on specific income categories.

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