Taxes for BME PhD Students
**If you are unsure how to properly report and file your taxes, it is highly advised that you seek professional tax advice. JHU does not provide tax advice, and the information below should not be considered as such.
The JHU Tax Office:
Unfortunately the JHU tax office does not provide tax advice. However, they are available to help clarify questions about JHU tax forms provided to students, as well as handle issues with missing or incorrect tax documents. The JHU Tax Office provides limited information regarding taxes, including definitions of Resident/Non-Resident Aliens for tax purposes, Payroll Tax Information, Substantial Presence Test, and Tax Treaties.
Visit the the JHU Tax Office website for more information on these topics and also to view a list of Frequently Asked Questions. The tax office meets with people individually but it might be more efficient to try email or phone first. Their contact information is below:
JHU Tax Office
4th Floor - North Building
3910 Keswick Road
Baltimore, MD 21211
If a student has a question about a tax document received from the University, they should contact the Tax Office and they can assist. If needed, they can also transfer students to the appropriate party (e.g. 1098-T questions are fielded by the department as they are most familiar with the underlying data).
During your first year, you are paid from an NIH supported Training Grant Fellowship. Therefore, your stipend is not considered wages since it is provided for educational and training purposes. For this reason, your taxes are NOT withheld from your paycheck/stipend, but you will still be required by the IRS to pay taxes on your stipend.
It is up to you to pay quarterly estimates for taxes, and in some cases a fine is incurred if you fail to do so. Income for most external fellowship supported students and those paid by an internal training grant are subject to income taxes but NOT Social Security or Medicare.
IRS Publication 970 also provides information on fellowship income. It may be downloaded from the IRS web site at www.irs.ustreas.gov.
Your pay stubs are online at http://www.controller.jhu.edu/. Just click on Web Pay Stub. You will need your JHED ID and Password to proceed to the stubs. Please note that no documentation is required to be attached to your income tax returns for this income. Since the income is also not subject to income tax withholding the tax on taxable fellowships should be paid through quarterly estimated tax payments. The Federal vouchers are Form 1040-ES and may be downloaded from the IRS web site. The Maryland state vouchers are Form 502D and may be downloaded from the Comptroller's web site at www.comp.state.md.us.
At the end of the first year when you officially join a laboratory, you will be paid from a different source than you were paid during your rotations. Generally from this time forward, your paycheck is then subject to normal tax-withholding and your income considered regular wages. You are responsible for filing your taxes accurately and in accordance with federal, state, and local laws.
Note: Regardless of how many rotations you do or if you choose to join the first lab that you rotate in, you will continue to be paid by the department (via a fellowship) until the end of your first year.
For International Students:
The first thing for international students to do is to apply for a visa. You won't be able to do it until you receive an I-20 form from Hopkins. Typically, it is mailed separately from the information package sent by the BME department. Once you successfully get your visa, all you have to do is to follow the instructions given in the package and pack your luggage and be ready to enjoy the next stage of your life, at Johns Hopkins.
Once you arrive at Hopkins, the first thing you have to do is to check in with the international student office at the Medical Campus and they will have more paperwork/forms for you to fill out. The next thing to do is to open a bank account so that the payroll office can do direct deposit for your stipends.
It is very important for international students and scholars to understand their U.S. tax responsibilities. Any international present in the U.S. for any part of the calendar year must file a tax report with the IRS the following April. For detailed tax information, responsibilities and deadlines please see the IRS website. The OIS is not legally permitted to provide any tax guidance or assistance. For specific information it is best to consult the IRS website directly.
The JHU Tax Office has purchased a license for GLACIER Tax Prep which is a Federal tax preparation software for Nonresident Alien (NRA) Students and Scholars. It is a product of Arctic International, LLC, a third party vendor. This information can be found in the JHU International Student website at http://ois.jhu.edu/Legal_Matters/Taxes/
Notes from the GSA-sponsored Seminar on Taxes:
**Please again note that this information is NOT tax advice. The following guidelines and information should be used at your discretion. All JHU, JHU affliliates, and the JHU BME PhD Student Council are not responsible for any fines or fees you might incur by following these guidelines. If you are unsure of your tax situation, please feel free to call the IRS directly using their hotline or seek professional tax advice.
Tax Q&A with Hopkins Credit Union and community CPA Joe Musumeci
- IRS publication 970 Tax Benefits for Education
- Interactive Tax Assistants
- Revenue Ruling 60-378 (IRC 117)
- Maryland Administrative Release 37: Domicile and Residency
- NSF GRFP Administrative Guide for Fellows and Coordinating Officials
- NIH Research Training FAQs
- Social Security Administration US International Social Security Agreements
- Electronic Federal Tax Payment System
- Maryland Individual Taxpayer Online Service Center
Mr. Musumeci’s contact information:
Selected Pre-prepared Questions:
- Where on my 1040 should I report my income (fellowship or W2)? Is it a scholarship or taxable income?
- Definition of terms (in the IRS’ eyes)
- Fellowship - amount paid for the benefit or aid in pursuit of research
- Scholarship - amount paid or allowed to aid in the pursuit of their studies
- These two are confusing, but there are some tests you can do later to see if this is taxable
- Form W-2 - information return about your income from your employer, if it’s involved you’ll report it
- Taxable Income - money, property, or services; “taxable unless there’s an exception” (i.e. scholarships, some other limited examples)
- Taxable vs. Tax-Free
- Terminology (i.e. fellowship/scholarship/stipend) doesn’t matter
- How do you tell?
- Are you a candidate for a degree at an accredited institution?
- It might be tax-free
- More tests
- Amount of $$ is used for other, non-education purposes (i.e. room and board)? Taxable!
- Tax-free if not received for services such as teaching or other work, even if it’s required for the degree
- NIH Core Scholarship Program - special exceptions
- Some military/veteran have special exceptions
- Example: $2500 scholarship, to get it you need to teach ($1000 for your teaching services). That $1000 is taxable income. The remainder, if used for your educational pursuits (NOT ROOM AND BOARD), then it’s NOT taxable income.
- IRS Publication 970 for educational people (Google it!)
- Interactive tax assistant (link above)
- Self-employment tax
- What is it? Covers payroll taxes, medicare tax for other than wages
- Do you owe it? Generally, no, usually just income tax; this is usually from trade agreements
- Does receiving a Form 1099-MISC trigger it? Not necessarily! Again, usually this is from trade agreements! (I.E. do you sell scarfs on etsy? Then you owe self-employment tax. Otherwise, this likely doesn’t apply to you).
- Reporting this income
- What do you exclude? Tax-free things (see definitions above and below)
- Include everything taxable!
- Use the interactive tax assistant if you need help!
- Definition of terms (in the IRS’ eyes)
- What are my options for filing (filling out the form yourself, online and paper, or something like TurboTax, tax preparer?)
- Each are viable options
- Paper vs Electronic filing
- No mandate for one over the other
- Purchased software- do due diligence, compare and choose what’s right for you
- Domestic students who are single: TurboTax Freedom is FREE for your federal taxes
- Comes down to your comfort level (financially/emotionally)
- International students: Glacier online filing for non-residents/aliens
- What do we do with the 1095-B form for healthcare?
- Has to do with the ACA (so things may change, but not this year (probably))
- 1095-A if you bought from the marketplace
- 1095-C is offer of coverage from your employer, you may get this and 1095-B
- If you’re covered by health insurance- check a box on your return
- If not covered- complete 8965
- I made money in another state last year, how do I report this? Related: To which state are taxes owed when you live in Baltimore but are a permanent resident of a different state? Is it where the money is made or where you live?
- Every state has its’ own approach (groan)
- Typically, you pay tax where you worked
- Apportionment (splitting up taxes, need to consider your situation & the states you worked in)
- Maryland: Residency - Administrative Release 37 (domicile vs residency); will affect what form you pay but likely not the $$
- Credit for tax paid in other states (PA, DC, VA, WV have special arrangements with MD in terms of taxes, pay attention to that if you live there)
- Unique situations
- How to report income from government fellowships such as NSF GRFP, NIH F31?
- Loose guidelines exist on the respective websites
- HOWEVER, it’s likely that this is 100% taxable and you need to go back to our first rules. Get a form, report it. Don’t get a form, pay quarterly taxes (see below).
- I’m an international student/trainee - do I need to file taxes in the US?
- If you earned money in the US, then yes; use form 1040NR
- If I’m on a training grant and receive a stipend, how do I file taxes quarterly?
- You should files taxes once a year, and make your quarterly payments (otherwise you have to pay a fee)
- Use a tax calculator online
- Helpful to find previous students/postdocs who have done this and ask how much they paid
- If you did not receive a tax return form (e.g., W2), write in your total income on the line where wages go (on 1040 form) and make a note to the side that says “SCH” (this indicates income is scholarship/fellowship)
● I went from a graduate student to a post-doc salary. How do I report my W-2?
- If you get one W-2, report that. If you get two W-2, report those.
● Students: what to do with 1098-T for tuition?
○ Even if you receive a W-2, you should probably report the numbers on the 1098-T, even if you never see that money. The IRS cares not exactly about dollars and cents, per say, but that money (that, granted, you don’t see!) is considered some kind of “benefit” that you are receiving from Hopkins (fees not charged, etc.)
○ If you are concerned, consider calling the IRS tax hotline or looking at the IRS website for people earning an education
● I was only covered for the majority of the year for health insurance, what do I do?
○ Depends, it likely depends on the length of time that you were not covered
● I moved here partway into the year. Where am I really a resident?
○ Both places where you lived. A portion based on the length of the time that you lived here.
FIRST YEAR STUDENTS/POSTDOCS
● Generally, you pay taxes where you worked. If you worked for half of the year in a different state, then you’ll likely pay taxes on those wages for that state, then pay for your fellowship/grant/income in MD.
● You are considered a “partial” resident if you moved to Maryland partway through the year. You’ll need to split your taxes based on the terms of your residency. This is only for certain taxes, such as taxes on your home- usually not your income tax.
STUDENTS/POSTDOCS ON TRAINING GRANTS (i.e. you do NOT receive a W-2)
● If you’re on a training grant (i.e. BCMB students, PMB students, other students whose program is on an NIH training grant- i.e. you receive a paycheck but DO NOT receive a W-2) you need to pay quarterly taxes. Use an online tool to estimate your payments and submit those payments here.
● If you receive the NSF GRFP grant or the NIH F31 grant, there are loose guidelines that exist (see above). However, it’s extremely likely that this income is taxable, so act and plan accordingly.
● Every student will receive a 1098-T form. Although that money is “made up”, you need to report those numbers to IRS. The difference in sum between the fellowships you receive and the “tuition” you pay is considered a “benefit” from the IRS, which is taxable.
○ This is applicable no matter how you receive your stipend.
○ Note the difference in tuition and grants is the cost of your medical insurance. While you do not pay each month for your health insurance, the IRS considers this as a taxable benefit, which is why you owe money when you put down these numbers into TurboTax.*
○ *According to SOME tax preparers, this medical insurance can be waived and so you might not have to pay. It’s impossible to get a straight answer on this but in general is best to not take chances in case you are audited. REMEMBER THIS IS NOT ADVICE SO ACT AT YOUR OWN DISCRETION.
● Certain expenses are tax-free; these are qualified educational expenses - books, computers, fees etc. used specifically for the advancement of your degree (be sure to check with IRS on how they define what is tax-free)
● Report the 1095-B form for healthcare- this usually just means checking off a box on your tax form that you
● Deductions- can list any business expenses, dependents, etc.