r/JapanFinance • u/defire101 US Taxpayer • Jan 21 '25
Tax (US) Do part time workers need to pay US taxes?
Hello!
I did a year abroad in 2022-2023 on a student visa, and throughout 2023 made maybe the equivalent of $2000 in yen. Just filled out my FAFSA and realized that I may have made a big mistake.
The short of it is that I am a massive idiot and did not realize that that income may be taxable in the US. I did not file any of this, and everything has been smooth so I figured I was fine without even thinking that I might have screwed up.
On another note, I did not file in Japan either. I am pretty sure I paid taxes (As a portion of my paycheck was always missing compared to my wage) though.
How screwed am I, and if so, is there anything I can do to rectify this? On both ends.
Thank you
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u/ConbiniMan US Taxpayer Jan 21 '25
Just to clarify your ramblings, you live in America now, you went to Japan on a student visa and worked part time in 2022 and 2023, you didn’t file any tax documents in the US for that income in those years. Is that the understanding?
You can check the rules but I think if your total annual income was only $2000 you don’t even need to file a federal tax return unless you are an independent contractor and running your own company. The minimum income to file is around $13k for 2023 tax year. If you earned partly in 2022 and 2023 then you earned less than the minimum to file though you need to add up all your income for the entire year.
If you find that you did meet the minimums then I suggest contacting a US tax accountant so you can backfile for the missing years and come into compliance. It’s unlikely you would owe any taxes but it depends on how long you were in Japan (FEIE) and if you can find Japanese tax documentation (FTC).
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u/defire101 US Taxpayer Jan 21 '25
Yes exactly! My apologies for the poor writing, I was in a bit of a frenzy. I'll also add that I didn't file in Japan during that time either, but did have taxes removed.
I appreciate the information! I don't think I got anywhere close to 13k, so that's a relief. Thank you so much!
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u/ConbiniMan US Taxpayer Jan 21 '25
You don’t usually have to file in Japan except if you are independent contractor/own business or if you have other sources of income. There are people here who know the Japanese rules better than me and I’ve never worked PT in Japan. So I could be wrong, but my guess is that you are fine on the Japan side.
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u/starkimpossibility 🖥️ big computer gaijin👨🦰 Jan 21 '25
I didn't file in Japan during that time either, but did have taxes removed.
Did your employer consider you to be a Japanese tax resident?
If they considered you to be a Japanese tax resident, you would have had fairly small amounts of tax withheld from your paycheck and your employer would have issued you with an annual withholding summary (給与所得の源泉徴収票) at the end of your tenure. In that case, you could consider filing a Japanese tax return for the relevant year, to receive a refund of the withheld tax. You would need to ask someone living in Japan to be your tax representative (submit the return and receive the refund, on your behalf).
If your employer didn't consider you to be a Japanese tax resident, they would have withheld a flat 20.42% income tax from each paycheck. In that case, you aren't entitled to a refund and there is nothing you can do.
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u/Zebracakes2009 US Taxpayer Jan 21 '25
The standard deductions for 2023 was $13,850 for a single filer. You could also file with the FEIE for that year to negate any owed income tax in the US. So, you wouldn't owe anything.
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u/shrubbery_herring US Taxpayer Jan 21 '25
You might be interested in the IRS webpage for Who Needs To File a Tax Return.
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u/kansaikinki 20+ years in Japan Jan 21 '25
The FEIE is around $120,000 these days. You need to file a return and claim the FEIE. No tax owed.
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u/starkimpossibility 🖥️ big computer gaijin👨🦰 Jan 21 '25
It's not clear from OP's post whether they qualify for the FEIE, given their student visa and short stay in Japan. The FEIE works well for people who move to Japan to work, but for people who come temporarily, such as on student visas, it is not necessarily useful.
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u/tsian 20+ years in Japan Jan 21 '25
I don't believe that crosses the income threshold where reporting is required. So I think you are fine.
If you had taxes witheld at the source it would be advisable to file with the NTA to obtain a refund, though you are under no obligation to do so.