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claim back USA Tax

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  • R42
    R42 Posts: 10 Forumite
    Ninth Anniversary 10 Posts Name Dropper
    edited 30 June at 4:23PM
    EdSwippet said:
    So you paid both UK tax and NI at 47% and then another US withholding tax (30%?) on top for this RSU vesting? That would leave you little more than pocket money.

    Correct :'(

    EdSwippet said: 
    You can probably do this without treaty claim, but doing it with, since you have one, would make things crystal clear to the IRS, an organisation not exactly renowned for its flexible or intelligent approach to edge cases.

    I was thinking the same too. There's also a note on Line L: "Attach Form 8833 if required" which is another confusing form. The instructions seems like I can exclude! But it also mentions that there could be a $1000 if I don't include it when I should have. 

    Should I not risk it with Form 8833 and include it anyway? This one is the most confusing and requires me to read IRS tax law to fill it in correctly. 


  • EdSwippet
    EdSwippet Posts: 1,664 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    R42 said:Should I not risk it with Form 8833 and include it anyway? This one is the most confusing and requires me to read IRS tax law to fill it in correctly.
    Form 8833 has some cases where filing is explicitly required, some where it's explicitly waived, and some they say nothing about. I have never been able to parse these. My take is that it's far less time to just fill out a copy and send it than it is trying to work out which of these three states you fall into. It's about five minutes of work. If it's redundant the IRS can simply ignore it.

    On my reading, your case is simple. Aside from the obvious parts (name, address, ITIN when you get it), whoever withheld US tax will send you either a 1042-S or - sans W-8BEN - perhaps some 1099. This will show their payer details; put in box 3. In 1a, "United Kingdom" (don't shorten to UK - the IRS has been known to misinterpret this as Ukraine!), 1b "Article 14 paragraph 1". 2 is "26 USC 871(a)", 4 is "Article 23 paragraph 2(a), 5 tick "no", and 6 write something like "Employment income of $xx is not US taxable to a UK resident who is a US nonresident alien, treaty article 14 paragraph 1". Done. Package together with completed 1040-NR and Schedule OI, mail, then wait.

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