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-   -   Re-establishing residency and claiming treaty benefits multiple times (https://www.askmehelpdesk.com/showthread.php?t=449992)

  • Feb 21, 2010, 10:28 PM
    tempac
    Re-establishing residency and claiming treaty benefits multiple times
    In 2002, 2004, 2005, 2006 I did summer internships at US universities
    (F-1 student), no longer than 10 weeks each. In 2004, 2005, 2006 I
    Received a fellowship or wages from a given school and I filed tax
    Returns for those years, each time claiming Tax Treaty benefits on the
    Grounds of Article 18(1) of the US-Poland Tax Treaty. The period
    2002-2006 spans 5 tax years, so I was convinced I could not claim Tax
    Treaty benefits anymore.

    In 2006 I left the USA in late August, and I came back for grad school
    In 2007 in mid-September, so I left the USA for more than 365 days. A lady
    From the payroll department at my current school told me that this way
    I re-established residency in a foreign country and therefore I might
    Be eligible for Tax Treaty benefits again. In 2008 I also became a
    Resident Alien for Tax Purposes.

    I tried to do some research on "re-establishing residency" and I found
    Out that as long as the relevant treaty does not contain a
    Once-in-a-liftime Clause, an individual is allowed to use the treaty
    Benefits multiple times.

    I believe the US-Poland Tax Treaty does not have such a clause. It
    Seems to have a Back-to-back Clause, which requires an individual to
    Re-establish residency in home country before using tax treaty
    Benefits again, but, as stated above, I fulfil this condition. Does
    That mean I can claim treaty benefits for 5 more years, starting from
    2007 when I arrived in the USA for grad school (still an F-1 student)?

    Does my Resident Alien for Tax Purposes status change anything?
    According to the IRS Publication 'US Tax Guide for foreigners',
    Resident aliens can still claim treaty benefits.

    I'd be grateful for any advice.
  • Feb 22, 2010, 10:30 AM
    MukatA

    On F-1 you are exempt from residency for 5 years only once.
  • Feb 22, 2010, 01:51 PM
    tempac
    Many thanks for your reply!

    Quote:

    Originally Posted by MukatA View Post
    On F-1 you are exempt from residency for 5 years only once.

    I'm a little confused. You're saying this based on which article of the US-Poland Tax Treaty? Or some IRS regulation?

    So you're saying I can claim treaty benefits as an F-1 student only once even though I re-established residency in Poland and there is no Once-in-a-lifetime clause in the treaty?

    Thanks again!
  • Feb 23, 2010, 02:23 AM
    MukatA

    Read IRS publication 901. Tax Treaties. In case of Poland, the treaty clearly states that it is for maximum 5 years.

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