Canada

Attending an American school as an international student is an exciting opportunity. Even so, it presents logistical, cultural and financial challenges that can only be mitigated with sound planning.

Prospective students and families must plan well in advance to avoid running afoul of unexpected taxes, preserve their wealth for future generations and enjoy an enriching experience at a U.S. educational institution. Here are some of the challenges they'll need to solve for:

1

Obtaining a Visa

In general, anyone entering the U.S. (other than a tourist) needs a visa. This can be the most challenging issue facing those who wish to stay in the U.S. for an extended period of time. Depending on their reason for coming to the U.S., students may apply for a J-1, F-1 or M-1 visa.

2

Establishing a Financial Footprint

Students will need money to pay for food, entertainment and myriad other daily living expenses. Relying on a foreign bank account to access cash is typically not an optimal solution. They will also need to obtain housing, which may require a credit check.

3

Staying Connected to Family Back Home

Arranging for a practical, affordable means of long-distance communication is important but often overlooked. International students need to stay apprised of issues that affect their families in their home country. Likewise, parents need to be aware of the possible dangers of not informing children living abroad of family developments.

4

Paying U.S. Taxes

Although visitors on student visas are exempt from some taxes, this does not apply to all forms of income, capital gains or transfer taxes. Students may be required to file certain tax forms with the IRS on an annual basis. For non-resident students, it is important to do this on time to avoid being subject to taxes on worldwide assets.

$1M

The number of international students enrolled in U.S. schools during the 2015–16 academic year.1

85%

The increase in the number of international students studying in the U.S. over the last decade.2

4x

The increase in the number of Chinese students at American colleges between 2005 and 2015.3

“With some thoughtful planning, significant tax savings can be achieved and wealth can be preserved for the individual and future generations...”
Seek Expert Advice and Plan Well in Advance
Begin planning as early as possible

Gaining acceptance to a U.S. college or university can take well over a year, so it's important to begin looking at schools early. If a student decides to become a permanent U.S. resident and potentially a U.S. citizen, sufficient time should be allowed to plan for the potential to shelter worldwide assets from the U.S. tax net.

Investigate financial aid and assistance

U.S. tuition is often very high. International students can take advantage of various educational assistance programs, such as merit- and need-based scholarships offered by private organizations, assistantships and fellowships (especially for graduate students), as well as financial incentives offered by the schools themselves.

Students must abide by the rules

The numerous regulations and procedures regarding issues such as entry date, exit date, length of stay and potential taxes may be strictly enforced, particularly in today's environment.

  • Footnote

    1 Douglas Belkin & Newly Purnell, “Foreign Student Admissions Keep Pace", The Wall Street Journal, July 7, 2017

    2 Belkin & Purnell, ibid

    3 “The Long March from China to the Ivies", The 1848 Magazine, The Economist, Brook Lariner, April/May 2016

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