Tag Archives: j1

J1 Visa – Work & Travel Program Background

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The J1 visa, officially known as a “cultural exchange” visa is used for many purposes including;

– High School Exchange Programs
– Work and Travel Programs (WAT) for College Students (this is a strict requirement)
– Au Pair
– Camp USA Programs
– Internship or Trainee Programs
– Some Government and Academic Programs

In other words it is a very versatile visa designed for many practical purposes as far as the US is concerned.

Today I will focus of the Work and Travel aspect of the visa as while I don’t have the data is probably by far the most popular use of this program. To note there is a spousal J2 visa associated with the J1, but generally that will only be awarded in the cases of the longer in period Internship, Government and Academic programs.

The Work and Travel program is designed for current University/College students in their respective long holidays (so usually their Summer) to visit and be able to work in the US for up to 4 months. The period of the visa is usually determined by a combination of how long their work period is, how long their college break is and how long the local US Consulate/Embassy is willing to give them which is based on the two earlier factors as well as what region of the world they come from.

Obviously depending on which part of the world you come from this means you may be in the US in Winter (South America and Africa), Spring (SE Asia) and Summer (Europe, China, India, Middle East) depending on when your long holidays are at your University or College.
Australia and NZ citizens recently have access to a 1 Year Work and Travel program which functionally works the same except they have a longer period.

Now I don’t want to be too controversial in this post about the J1 WAT program but there are definitely some practical differences in the way it is administered depending on what country you are from, even if that is not a stated official policy.

So what I mean by that is that, officially the Work and Travel program requires you to have organized a job with a US employer which has then been approved by a State Department approved sponsor organization. So unlike the regular working visas like H1B, E3, etc., where your employer directly sponsors your visa, here it these designated organizations that are your sponsor and responsible for ensuring you meet requirements on the State Department’s behalf.

Additionally in 2011, students are required by the U.S. State Department requires candidates to obtain a job offer with an employer prior to their visa interview. Furthermore residents of Eastern European nations; Russia, Ukraine, Belarus, Bulgaria, Romania and Moldova must have that said job confirmed by their Sponsoring Organization with the employer as valid for the J-1 visa program.

For J1 WAT there are currently 71 approved sponsors listed on the State Department’s website including CIEE, Intrax and InterExchage among others.

Back to the controversial aspect of it all, as I mentioned you need to have organized a job prior to coming to the US. However this requirement is loosely administered for some nations and vigorously for others under the general unofficial guise of students of certain countries being a greater risk to stay longer than their visa allows.

I will discuss this point more in detail in another post as well as more a step by step guide process to getting employment and this visa.

So some students look at this program as mainly just an extended holiday with the ability to work. Where as others work a lot, travel very little, in the hope when then transfer money back home they will gain a lot from a strong US Dollar. As I said the earlier option is officially disallowed and can have your sponsor organization cancel your visa making you illegal in the country, but it administered loosely depending on where you are from.

I hope this helps provide a nice background context to better understand the J1 visa and what its benefits are. Like I said I will go into further details about many of the points raised here in future posts.

CJ

US Working Visa Holders & Doing Your Taxes

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OK firstly I have to say I am not an accountant or any form of tax advisor so don’t hold anything I say to be 100% gospel…yu know all that disclaimer stuff about seeking your own advice and be sure when you do anything and blah blah blah 🙂

Ok that said, the US tax year as far as personal income tax is concerned is the Calendar Year (so Jan 1 – Dec 31)

This differs from many countries which have the July-June or April to April year and it is important to note not all US corporations us the above as thier tax year but as you filing your taxes that is what you need to do.

For J1:
So this is the visa where you have most likely been working on a Work and Travel Program, Internship, Au Pair or programs like Camp USA. As far as tax treatment goes, you get it pretty easy in that only Federal, State (if applicable) and Local (if applicable) taxes apply.
You DO NOT have to pay either Social Security or Medicare taxes which is a great saving and given that neither you nor people on H1B, E3, L1, etc. have access to Social Security or Medicare it seems fair that you don’t have to pay it.

For H1B, E3, L1:
So this being the regular working visa group with slightly different entry criteria and benefits. Here you are obliged to pay all of Federal, State (if applicable), Local (if applicable), Social Security and Medicare. So it is important to look at the tax rates of your State and possibly city and factor in the other taxes beyond your federal tax bracket.

Check out http://en.wikipedia.org/wiki/State_income_tax for the different tax rates of states

General Info

Now the reason why I said if applicable for state and city is that a few states like Texas, Florida and a couple of smaller populus states like New Hampshire, Alaska do not have state income tax which is a great saving to you.

For cities, well New York CIty charges you the privilige for living there but am not aware of any other city in the US that charges a city income tax.

Now the question comes up, what if I reside in one city but work in another, what is my tax rate then? am I taxed twice? do I get a credit?

The answer is, it depends on which 2 states you are talking about, whether there is another party involved like a spouse who may live in your same state but work in the same state or a third state and what the relative difference is in tax rates between the states in question. IN SHORT IT IS CRAZY!

For example in normal circumstances a common occurence is the case of living in the state of New Jersey but working in New York. More often than not you will ultimately only pay NY taxes as the NJ government recognizes your taxes paid in NY and the rate in NY is higher than NJ. However that does not work as easily in reverse and with other states it depends on the treaties regarding tax they have with each other.
Your employer should be withholding tax correctly during the year as you are beign paid but ensure you are getting your full credit/refund or paying taxes owed if this is your circumstance and consult with experts if necessary.

Generally you will have until mid April to file your taxes and you should receive your W2 form from your employer sometime in January for the previous year. Go to the IRS website to find people to do your taxes through for both Federal and State.

Stupidly it is not free for most people  as you will invairably go through a 3rd party online portal like HR Block, Turbo Tax, Tax Slayer, etc but these are very straightforward and easy to use for most circumstances. Forget using an accountant unless you are really clueless (which I doubt given you got to the US to begin with) or you have a complex situation. Generally the online portals cost about $10-$30 to do both returns which isn’t too bad.

Most J1 visa holders should quality for free filing as you are probably young enough and/or have below the companies income threshold for charging you. You will still use one of the above companies except it will be FREE.

You can get refund checks mailed overseas (and you can file taxes from overseas). It is your obligation to do it so ask your employer for your W2 form if they don’t send it. It is their legal responsibility to give it to you. Contact the IRS if they refuse. You can also get your refunds deposited into your US Bank account from both Federal and State.

With deductions it probably similar to most places where you can get exemptions for travel, health, moving costs, education, work costs, mortgage repayments, etc. so just ensure you have all the documentation.

If you lived in multiple states during the year you will most likely have to file multiple state returns.

I hope this overview helped and do your own research too. As always send through your comments and I will try and help and otherwise I hope you get a Fat Refund Check!!

CJ