International Students and U.S. Taxes
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Please know that Student Registration and Financial Services employees are not tax professionals and are not authorized to offer you personal tax advice. Ultimately, you may wish to consult with a qualified tax specialist or the Internal Revenue Service.
As an international student, please keep in mind that a portion of the grant funding you receive from Penn may be subject to U.S. taxes. Any scholarship funding you receive that goes beyond tuition, fees, and the allowance for books/supplies is considered taxable income by the U.S. government. In general, Penn will withhold 14% of any excess scholarship funding to meet this tax requirement. The final withholding amount may differ depending on your tax status and any existing tax treaties between the U.S. and your home country.
You will see a charge on your student account each semester indicating any taxes that Penn has paid on your behalf notated as “Withholding Tax on Grant Aid.” Note that these taxes cannot be covered by additional grant funding from Penn, so you must plan for this additional expense each year. This charge generally appears in the middle of each semester, so be careful to review the bill you receive each month.
You may be able to recoup some of this funding by filing an annual tax return. You will need to submit a non-resident tax return by April 15. To learn more about how to request an International Tax ID Number (ITIN), visit this Tax Information page from International Student & Scholar Services (ISSS). For a broader range of information about international student financial issues, visit the ISSS Financial Matters page.
If you do receive a tax refund, it is important that you save this money to apply toward any taxes withheld on scholarship funding you will receive in the following academic year.