As an international student in Philly, can I be refunded withheld Pennsylvania and Philadelphia taxes from a summer job in Texas?

As an international student in Philly, can I be refunded withheld Pennsylvania and Philadelphia taxes from a summer job in Texas?

by Michael A. Gillen, CPA | Aug 09, 2019

I'm an international student doing an MBA in Philly. I was never considered as a Philadelphia resident, only a nonresident alien. I worked for a summer in Texas, indicating for employer's correspondence the address of the apartment I was renting in Philly. Pennsylvania and Philadelphia wage taxes were both withheld from my pay. Is there any way to get a refund for those taxes if I've never worked or even stayed in Philly throughout that summer?

An individual is considered a Pennsylvania resident for personal income tax purposes if he or she either is domiciled in Pennsylvania or is a statutory resident. Pennsylvania residents are subject to state personal income tax on all state taxable income classes, both Pennsylvania and non-Pennsylvania source income, though they may qualify for a resident credit for taxes paid to other states on income earned outside of Pennsylvania.

Domicile is the place where an individual, by present and voluntary intention, establishes his true, fixed, and permanent home or home for the indefinite future. Domicile is the place where an individual intends to return whenever absent. Domicile is a matter of intent and fact, and once established continues until a person abandons the existing domicile and establishes a new one. A person asserting a change of domicile has the burden to prove the change. A person may have more than one residence, but may have only one place of domicile at a time.

Individuals who do not have either their domicile or statutory residence in Pennsylvania are considered nonresidents for personal income tax purposes. Nonresidents are taxed only on the income they receive from sources within Pennsylvania, and cannot qualify for the credit for taxes paid to other states.

A student will be considered a resident of Pennsylvania for tax purposes if he or she:

  • Is domiciled in Pennsylvania, or
  • Is considered a statutory resident - maintains a permanent abode in the state and spends more than half of the year (183 days) in Pennsylvania (statutory resident).

A permanent place of abode does not include college dorms, fraternity and sorority houses, and off-campus rentals used for a fixed term during which a student pursues a degree or certificate.

If you are not domiciled in Pennsylvania and cannot be considered a Pennsylvania statutory resident, you can file a Pennsylvania income tax return to claim a refund of state taxes erroneously withheld.

For Philadelphia, you can file a Philadelphia wage tax refund petition for a refund of city taxes withheld on income earned outside of Philadelphia. You should attach a statement to both returns explaining you were/are a graduate student at your school, the income was earned outside of Pennsylvania/Philadelphia, and that you are not considered a resident of Pennsylvania/Philadelphia for tax purposes because you are an international student domiciled elsewhere.

For more resources, check out PICPA’s Money & Life Tips, Ask a CPA, or CPA Locator.

Answered by: Michael A. Gillen, CPA, is director of the tax accounting department at Duane Morris LLP in Philadelphia.

The responses are based on the limited information provided by the questioner and apply the laws and regulations at the time of posting. Other options could arise as rules and regulations may change over time, including but not limited to the passage of the Tax Cuts and Jobs Act of 2017. They are intended to provide general information, not specific accounting or tax advice; they are not intended or written to be used and cannot be used for the purpose of avoiding or evading taxes or penalties under the IRS code or regulations. Views expressed do not imply an opinion of the PICPA, its officers, directors, employees, or members.
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