TAXES
Income Tax
Federal Income Tax
Illinois State Tax
Filing Income Tax
Social Security Tax
Sales Tax
Income Tax
Federal and state income taxes are withheld (deducted)
from all Argonne paychecks. This withholding procedure is regulated by
law. Residents of certain foreign countries having tax treaties with
the United States may be entitled to reduced rates of, or exemptions
from, tax under the applicable tax treaty. If you believe you qualify
for such a tax exemption contact the Argonne Payroll Department for
advice. The individual tax year is from January 01 to December 31 of
each year.
The amount of taxes withheld depends on whether you are
a resident or non-resident for tax purposes. Non-resident aliens are
permitted only one personal exemption, and tax withholding is made
under the "single" status withholding tables for both state and federal
taxes. Resident aliens (Green Card Holders) are permitted to claim as
personal exemptions their dependents who are also resident aliens,
and tax withholding under the "married" status (if applicable).
Non-resident aliens are able to correct this inequity when completing
and filing their tax returns. At that time, you will determine any
difference (positive or negative) between what you owe and what was
withheld by Argonne and receive the appropriate refund or tax bill.
Federal Income Tax
The federal tax you actually owe is determined by
an Income Tax Return (Form 1040 NR for Nonresident Aliens),
which you must file with the U.S. Internal Revenue Service between
January 1 and April 15 of the following year. The Internal
Revenue Service gives free and off-the-record advice on how to save on
taxes and will mail you forms and publications. Their toll-free
telephone number for information is (800) 829-1040. Information,
forms and publications are also available on the Internal Revenue
Service web site www.irs.gov . Some publications of special interest:
- Publication 505 - " Tax Withholding and Estimated Tax"
- Publication 519 - " United States Tax Guide for Aliens"
Each person included on the tax form must have a Social Security Number. If your dependent (i.e. spouse, child) is not are not eligible to obtain a Social Security Number (SSN) from the Social Security Administration (SSA) they must obtain an Individual Taxpayer Identification Number ( ITIN)
for you to deduct them on your tax return. ITINs are issued regardless
of immigration status because both resident and nonresident aliens may
have U.S. tax return and payment responsibilities under the Internal
Revenue Code, such as dependent or spouse of a U.S. citizen/resident
alien or dependent or spouse of a non-resident alien visa holder.
An ITIN does not authorize work in the U.S. or provide
eligibility for Social Security benefits or the Earned Income Tax
Credit. ITINs are not valid identification outside the tax system.
IRS issues ITINs to help individuals comply with the U.S. tax
laws, and to provide a means to efficiently process and account for tax
returns and payments for those not eligible for Social Security
Numbers. Once a SSN has been obtained for a person the ITIN is no
longer valid.
Illinois State Tax
Illinois income taxes are withheld at a 3.0% rate, after
reducing the monthly taxable salary by the personal exemption amount
allotted for the year. You can find assistance regarding your state
taxes at www.revenue.state.il.us . State tax forms are due on April 15th along with the Federal Tax forms.
Filing Income Tax
Your income tax return is due on April 15th. You must
file separate forms for Federal (1040) and State (IL-1040) taxes. Both
the federal and state revenue departments offer free advice by
telephone and internet. If you are expecting a sizable refund (since
you were only allowed to make a single exemption on your taxes) it
would be worthwhile to submit your taxes as soon as you have all the
appropriate documentation and not wait for the deadline. Refunds are
dealt with on a first-come-first-served basis.
There are many commercial programs available that will
guide you in completing these forms, calculating the tax and filing
on-line. It may be a worthwhile investment to a newcomer to the United
States to use one of these programs and ensure that all legally
required taxes are paid (yet not overpaying). On the other hand you may
choose to seek the advice of a professional tax consultant or Certified
Public Accountant. For a referral ask your colleague or check the
internet or telephone directory. The professional fee or cost of the
tax program is a tax deductible expense.
Social Security Tax
Social Security tax, referred to as FICA, is
withheld as a percentage of wages up to a maximum wage base.
Non-resident foreign visitors with an Exchange Student (F) or
Exchange Visitor (J) Visa are exempt from this tax. For all others it
is mandatory, even if you do not expect to take advantage of the Social
Security benefits, such as retirement income.
Sales Tax
The United States does not have a Value Added Tax (VAT) included in the
marked price of merchandise. The State of Illinois currently has a
1.25% sales tax on purchases of food and drugs and a 6.75% sales
tax on nonfood items, luxury food items, and food in restaurants. Some
towns may add additional sales tax. Sales tax within the city of
Chicago is 8%. This tax is computed and added on to the total price of
purchases at the time of sale.
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