Question

I am a US citizen in an overseas degree program. I earn 20k in stipend & and pay taxes overseas. I do not abroad long enough, so no exemption. How much tax do I pay? 1k?!

Forum|Forum|1 year ago
March 25, 2025
1 reply
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Since my program started in August 2024, I do not qualify for the Bona Fide or Physical Presence exemptions. But $1k in taxes seems excessive for having received $20k in housing stipend. FYI, my housing cost more than that.

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V

Vanessa A

Housing stipends are taxable income. If you use money for housing it is taxed just like your other income is. So whether you used the $20k for rent or to go on a cruise, the tax treatment would be the same. If your ONLY income is that $20k, and you are single, then you would have $5,400 in taxable income after subtracting your standard deduction of $14,600. The tax on that would be around $540 as you would be in the 10% tax bracket.

How did you enter the stipend? Is it being treated as self-employment income? Do you have any other income?

If you are paying taxes on the income in another country, you my be able to claim the foreign tax credit.

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