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Tax Information for Students

Introduction to tax reporting content for UC Davis students

For non-resident students and scholars

Student FICA

  • Student wages maybe exempt from FICA. Please review the description in the FICA Codes Table 

Fellowships FAQs

  • I want to award a scholarship to an active student. How do I do this?
  • The appropriate process is to pay scholarships to active students is through Banner. Please work with Student Accounting. If a scholarship for an active student is submitted through KFS it will be returned to the department and delay the delivery of the funds.

  • When does the University report fellowships for scholarships?
  • The answer is dependent on the residency of the recipient.  

    United States citizens, Permanent Residents or Resident Aliens – The IRS does not require the university to report scholarship or fellowship grants for United States citizens or resident aliens; however, under IRC Section 117, the determination of whether a scholarship or fellowship grant must be reported to the IRS by the recipient is based on whether the grant (or a portion of the grant) is qualified or non-qualified and whether the recipient is a degree or a non-degree candidate.  IRS Topic No. 421 Scholarships, Fellowship Grants and Other Grants provides specific guidance on expense categorization and recipient reporting requirements. 

    Nonresident Aliens -  Under IRC Section 1441,  the University  must report income and withhold Federal income tax from all income payments made to or on behalf of a nonresident alien unless the payment is excluded under specific IRS code exemptions. The most common exemption is a tax treaty.   All persons receiving payment from the University who are in the US on a Visa must complete Glacier registration.   Upon completion of Glacier, the payee will be advised if there are tax treaties available.

    Absent regulatory exclusions, non-wage payments made to a nonresident alien that has been determined to be taxable are subject to income tax withholding at a 30% rate. However, a special 14% rate applies to any taxable scholarship or fellowship grants paid to F or J visa holders.  Income subject to tax treaty exclusions and / or the 30% or 14% withholding are reported on the annual 1042-S form, Foreign Person's U.S. Source Income Subject to Withholding.   The IRS has a dedicated page for Foreign Students and Scholars