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    julesk's Avatar
    julesk Posts: 1, Reputation: 1
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    #1

    Apr 28, 2008, 02:39 AM
    German/American Tax Treaty Exemption for Trainees
    Hi!

    I am a German legal clerk. Last year I did a 3 months internship in an American lawfirm. I entered the US with a B1 Visa ("unpaid legal clerkship"). (This was possible at that time. Nowadays, all legal clerks have to apply for J1 visas) The american lawfirm paid me 1500$ a month as remuneration for living expenses which I also indicated upon my application for the visa. Altogether, I received 4750$ from the lawfirm. During this time, I also received my regular income from the Higher Regional court in Germany. I am wondering now whether I have to file a tax report in the US on this amount. I heard there is a 5000$ exemption in the German/American tax treaty for trainees. But does this mean that I have to file a tax report though? And when I have to file, which form do I have to fill out and do I need any confirmation from the firm about the amount received?

    Thanks a lot!
    MukatA's Avatar
    MukatA Posts: 7,110, Reputation: 176
    Tax Expert
    		  
    #2

    Apr 28, 2008, 04:49 AM
    Since the money was paid by an American firm, it is taxable income. Did you receive W2? How did the employer report this money?

    I don't think you qualify for exemption for the trainee as you had B1 visa. But on your nonresident tax return, you get exemption of $3,400 and then you can calm living expenses as itemized deduction. So may be you will end up have little or no taxable income. But you may be required to file the tax return.
    For nonresident filing, read: Your U.S. Tax Return: U.S. Tax Filing Requirements for Non-Residents
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