Advice and Commom Errors to Avoid
on State Tax Returns from the Minnesota Department of Revenue
The Minnesota Department of Revenue would like to share the following list
of tax filing problems with the International Students who file either a
Minnesota Property Tax (Renter's Refund) return or a Minnesota Income Tax
Return.
During the process of reviewing the tax returns of International Students
we have observed the omission of certain types of nontaxable income from
the Property Tax Refund Return.
The following items must be included as additional nontaxable income on
line 5 of the Minnesota Form M1PR:
- Income exempt by tax treaty between the student‚s home country and
the United States. This amount should be listed on Line 6 of the Federal
Form 1040NR-EZ or Line 22 of Form 1040NR.
- Scholarships, fellowships, and grants that are excluded from federal
income. This amount should be listed on line 9 of the Federal Form
1040NR-EZ or Line 22 of Form 1040NR.
- Tuition benefits received by Graduate Assistants (Teaching Assistants
and Research Assistants) that are paid directly by a university
financial aid office. The benefit amount can be found on the student‚s
tuition statement.
Stipend or wages from a university, hospital or company in the home
country received by foreign teachers, researchers or physicians. This<
income must be included on the Form M1PR.
Some common errors involving the Federal Form 1040NR or 1040NR-EZ filed by
nonresident aliens:
- Foreign students erroneously claiming that their entire wage
compensation is exempt by tax treaty. Total exemption applies
only in certain circumstances. Please review the tax treaty exclusion
amount for your home country.
- Those who itemize on their 1040NR or 1040NR-EZ must addback the State
and Local Income Taxes on Line 2 of their Minnesota income tax return,
Form M1.
If any of these situations apply to you, please make sure to include the
proper amounts on line 5 of your 2005 Form M1PR. Also, if any income was
omitted from your 2003 or 2004 returns, please file an amended Minnesota
return, Form M-1PRX to correct it. Amended returns can be obtained on the
Minnesota Revenue website at: www.taxes.state.mn.us or by calling (651)
296-4444.
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