U.S. tax law divides non U.S. citizens into resident aliens and nonresident aliens for tax purposes. Your tax residency (whether you are a nonresident alien or a resident alien for tax purposes) determines how you are taxed and which tax forms you need to fill out. For the majority of individuals, your income tax is deducted from each paycheck and sent to the IRS. This is also referred to as tax withholding. International students and scholars who have been in the U.S. must file an annual tax report by the following year's tax filing deadline, both at federal and at state level. “Federal” refers to the U..S government and taxes are collected by the Internal Revenue Service (IRS). Tax payers may also be required to pay tax in the state where they live or work. If your payments were not enough to cover the total income tax due, you must pay the rest to the IRS. Conversely, if you paid more than what you owe in income tax, the IRS will send back your excess payment in the form of a tax refund.