Hi,

Am currently working on OPT and being paid $24k per annum as stipend during the 6 months training period. My presence in NJ,US is from Aug 2008 till date on F1 status. My employer initially said this income is not taxable as my stipend is below base amount. Is it so? Or in case wrong, what are the taxes do I need to pay?

Thank you.

In my opinion, you DO owe income tax (federal and New Jersey) on the stipend, unless the OPT period is considered an unpaid internship and the stipend is issued to reimburse you for living costs.

If it IS reimbursement, then you will NOT get a W-2. If not, your employer will issue you a W-2 in January 2011.

On F1/OPT you are exempt from residency for 5-years. You must file non-resident tax return Form 1040NR or 1040NR-EZ and Form 8843. Your income is not subject to FICA taxes but you must pay federal and state income taxes. On your income you will get deduction based on tax treaty between the U.S. and your country. Your U.S. Tax Return: U.S. Tax Filing Requirements for Non-Residents