Hi,

I am a German PhD student who came to the U.S. In August 2010 for the Master where I worked as a TA. I finished the Masters in May 2011, and got an offer to begin a PhD program in August at the same university (in Virginia), what I accepted. I still work as a TA.
In December, when trying to file my tax treaty together with the local experts, they told me that I am not eligible since I will very possibly work in the U.S. For more than the four years 2010-13. My questions are now:

1. I went back to Germany after my Masters and came back to begin the PhD program, so isn't it like a new program and the years should count from zero?

2. Do really the years count so that I only have time till end of 2013, and not till July 2014 what would really mean four whole years (or even longer since I am only employed 9 out of 12 months)?

3. Does anybody know why/or who to contact why Germany is the only country that only allows four years? And also whether there are any soon changes planned for this tax treaty?

Thanks a lot in advance!

The tax treaty provision pertains to a four-year period of study. It is available to you for four years as a student. It doesn't matter if you change program. You still only get four years.

As for the details - you would need to read the treaty to check if there is an exception to the savings clause which allows you to take the whole amount regardless of your residency status (if you changed to a non-exempt visa, for example), if you can get a second period of exemption if you re-establish residence in Germany, etc. Sorry, but I would have to read it thoroughly for that. Do be sure to check the actual wording of the treaty and its technical explanations.

I agree with AliTax; it IS only four years.

You CAN ask for a waiver/extension from the IRS by submitting Form 8833 to the IRS.

As to WHY it is only four years, you would need to ask the treaty negotiators about that. :-)