Kevin Mei wrote:

- quote -

I'm going to assume that you hold a student visa and are
exempt from the substantial presence test and are present in
the US as a nonresident alien. You are actively engaged in
a trade (you are a student) or business. The dividends are
sourced in the US and are subject to tax as either ordinary
or qualified (see page 1 of the Form 1040NR). Interest from
bank and credit union deposits are exempt from tax.

--
Alan
http://taxtopics.net

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I am a little confused when I read the U.S. Tax Guide for
Aliens (Publication 519). There is a paragraph in the
section Important Changes for 2003.
-----------
Dividends-new tax rate. ...... For nonresident aliens, this
rate applies only to dividends that are effectively
connected with a U.S. trade or business.
-----------
In the chapter 3 Exclusions From Gross Income, various
interests are mentioned, including portfolio interest.

My understanding is that dividends is not taxable for a
nonresident alien like me. I am a graduate student studying
in a US university. I only have less than $200 dividends in
2003. Am I correct?

Thanks, Kevin

P.S. It seems odd to me that the dividends are only taxable
when the nonresident alien owns more than 10% voting power
of a stock.

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