Some Frequently asked questions:
Can an F1 Visa Holder Open a Stock Account?
Can I invest in stock markets while in F1 Visa and attending university in USA
There’s no law barring foreign ownership of stock, or restricting stock trading by foreign visitors, whether they are in the United States on a temporary, immigrant or non-immigrant visa. To open a brokerage account, however, individuals must normally provide a Social Security number, which the brokerage will use to report interest and dividends to the Internal Revenue Service. In order to get an SSN, the F1 visa holder must file an application with the Social Security Administration, and provide a passport, the I-94 USCIS card that authorizes temporary residence in the U.S., and a valid offer of employment (strict limitations apply to work with F1 students).
The ITIN Alternative
Without a Social Security number, an F1 visa holder may apply for a brokerage account with an Individual Taxpayer Identification Number. The ITIN serves the same purpose as the SSN for income-reporting purposes, but does not authorize employment or confer any eligibility for Social Security. You may apply for an ITIN with IRS Form W-7, which requires proof of your identity and current visa status. Some colleges as well as brokerages are authorized by the IRS as acceptance agents, meaning they can assist with the ITIN application.
Gains and Income
A foreign visitor earning income or capital gains from stock trading will be liable for income taxes, just as citizens and permanent residents would be. The normal filing requirements and tax rates apply to non-immigrant stock traders. In addition, stock brokerages will require a foreign trader to complete Form W-8BEN, the Certificate of Foreign Status of Beneficial Owner. The IRS requires tax withholding at the rate of 30 percent from all interest or dividend payments to foreign account holders.
Do I have to pay taxes on earnings and dividends from stock tradings?
Of course, you earn money from stock trading, you have to pay taxes on the earnings. Refer to IRS or other tax websites to learn about long term and short term capital gains. If you lose money from trading, you can claim the losses too to a certain extent.
How to Invest in Stocks and Make Money in USA, How to trade stocks and options? Is there any cheap online stock brokers/websites?
Answer: Best app Robinhood trade stock for O$
Other websites for online trading:
- Tradeking ($4.95 per trade)
- Zecco ($4.50 per trade)
- OptionsHosue ($2.95)
- Scottrade ($7 per trade)
More about RobinHood app:
Interested in stocks? Robinhood lets you trade for free
Ditching the traditional fee structure used by the vast majority of brokerages, Robinhood for the iPhone lets investors purchase and sell stocks without having to pay a fee on each trade. This has created a new way for smaller investors with limited funds purchase stock quantities as small as one share without spending at least $8 on a trading fee.
The creators of the application make money on the interest collected on funds deposited for trading as well as interest when a user buys in margin. However, users aren’t required to maintain a minimum balance and can easily deposit earnings in their bank account at any time.