Taxes

The payments you receive for working at UC Berkeley as a postdoc employee are considered wages. The IRS requires UCB to withhold income taxes from your paycheck. UCB will therefore deduct some of your wages and pay them to the IRS. At the end of the year, UCB will provide you with a W-2 form, indicating the amount of tax that has been withheld from your pay. You will submit this form and the information on it to the IRS on your tax return, and that is all you really need to worry about. When you are first hired, you will be provided with a form W-4, a worksheet that will help the University determine how much money to withhold from your paycheck for taxes. This page also provides information on income withholding tax. 

Payments you receive for working at UC Berkeley are not considered “wages,” rather they are considered a “fellowship.” UCB is not required to withhold taxes from fellowships or to report fellowship payments for individuals who are U.S. citizens, permanent residents (green card holders), or resident aliens for tax purposes. The IRS and California Franchise Tax Board require fellowship recipients to “self–report” fellowship payments when they file their U.S. and California annual income tax returns. This means that the postdoc fellows themselves are solely responsible for keeping track of their own monthly fellowship payment statements. UCB will not issue a W-2 form for fellowship payments to postdocs in this category, since only payments that are considered wages are reported on the W-2. Postdoc fellows who fall under this category should refer to the IRS and CA Franchise Tax Board for information about paying quarterly estimated taxes.

The IRS does require UC Berkeley to withhold taxes from fellowship payments to postdoc fellows (those in title code 3253) who are non-resident aliens for tax purposes. At the year-end, a different tax statement, called a “1042-S” will be provided to such postdocs.

If you are paid by an external organization, such as a foreign government, your pay is not considered "wages," so UC Berkeley is not required to report such payments to the IRS. You will not receive a W-2 form. However, when a UCB department pays for the cost of benefits for a postdoc paid-direct, this contribution is considered a form of income called “imputed income,” and the amount of this contribution is considered taxable income.

If you have more than one appointment in the UCPath payroll system, more than one tax situation may apply to you. For example, if you receive a fellowship (Postdoc Fellow under title code 3253), but you also receive a supplemental salary from your PI supervisor (as a Postdoc Employee under title code 3252). In this case, part of your income will be reported to the IRS, and part will not. That means that although you would have to pay estimated quarterly taxes to the IRS for the fellowship portion of your pay, UC Berkeley will withhold the taxes from the supplemental portion of your pay.