Deductions

[Updated Feb 6, 2024]

What IS a deduction?

A deduction is an amount of money that can be deducted from your taxable income. The deduction will be recorded on your income tax return. When your taxable income is reduced by a deduction, your tax is then also reduced.

What is a Standard Deduction?

A standard deduction is a set amount that may be deducted from your taxable income. This amount varies based upon your filing status and generally increases each year to keep pace with inflation. The amount is not connected to any actual expenses you may or may not have had.

Standard Deduction for Nonresident Aliens on Federal Returns

F and J nonresident aliens are not eligible for the standard deduction EXCEPT for F visa nonresident aliens from India.  Students from India, see India F1 Students

Recent set amounts for the federal standard deduction (by tax year) filing single:

• 2023 - $13,850

• 2022 - $12,950

• 2021 - $12,550

• 2020 - $12,400

• 2019 - $12,200

• 2018 - $12,000

• 2017 - $6,350

• 2016 - $6,300

Standard Deductions on State Tax Returns

It is up to each state whether they a have a standard deduction and whether they allow nonresident aliens to use that standard deduction.

Oregon's Publication 17 (2021), page 95, states, “The standard deduction for nonresident aliens is -0-.” 

What is an Itemized Deduction?

The federal government and individual states may let you reduce your taxable income based upon actual expenses that you may have had in specific categories. Residents of the US can itemize deductions for medical expenses, mortgage interest, and other items on their federal return. 

If you are an F visa nonresident alien from India, you can claim the standard deduction. It will not benefit you to itemize unless the total allowable amount itemized exceeds the standard deduction for that year.

Federal Income Tax DeductionS

For F and J nonresident aliens there are a few types of deductions that can be put on the nonresident returns.

State Tax - can be deducted on 1040-NR, Schedule A, Line 1

Any state tax that was withheld from your paycheck during, or state tax that was paid during the year for taxes due with a tax return from a previous year may be deducted. This can be deducted on the 1040NR, Schedule A, Line 1.

IMPORTANT: If a portion of the state tax that is deducted on one year's tax return is then returned in the following year, the amount returned to that following year must be added back as income on the tax return for the year in which the money was refunded.

Other deductions that can be claimed on 1040-NR, Schedule A

• Deductions allowed on 1040NR (2021) 

  • Gifts to U.S. Charities - Schedule A, Lines 2-5

  • Casualty and Theft Losses (this is very limited) - Schedule A, Line 6

  • Other Miscellaneous Deductions - Schedule A, Line 7

See IRS Instructions for 1040-NR: search for "Instructions for Schedule A (Form1040-NR)—Itemized Deductions"

Oregon Income Tax Deductions

Federal Tax: Oregon allows the federal tax (or portion of) to be deducted.

There may be other deductions allowed on the Oregon state returns if they were taken on Schedule A of a 1040-NR (excluding Oregon tax withheld). 

If you do have a taxable portion of a scholarship on the federal form, the amount using for housing can be deducted on the Oregon form.

Oregon also has a few deductions allowed on their form that are not allowed on the federal form. This information is beyond the scope of our training.