Payments to Nonresident Aliens
HR, through the nonresident alien (NRA) tax office, is responsible for analyzing tax implications for payments made to individuals who indicate they are not U.S. citizens or permanent resident aliens, ensuring the university is in compliance with nonresident alien tax withholding regulations.
Not taxing correctly can be extremely costly to the university and can reduce the amount paid or reimbursed to a foreign national. A foreign national coming to the university must enter under the correct visa if she or he is to be paid legally.
Students who receive travel expenses in relation to their compensation (attending a seminar, conference, etc. in relation to employment) will not be taxed under the accountable plan that applies to all employees.
Students who receive travel expenses in relation to their scholarship/fellowship (attending a seminar, conference, etc) will be taxed at 14%, including travel reimbursement or payments made on their behalf. The 14% tax can be exempted due to an applicable tax treaty, if the student has a Social Security number or Individual Tax Identification number (ITIN).
Teachers/researchers/scholars who receive travel expenses in relation to their compensation (attending a seminar, conference, etc. in relation to employment) will not be taxed under the accountable plan that applies to all employees. Travel reimbursements will be paid through the Travel Office; any other payment will be paid through the Payroll Office per university policy. If the payment is being made to an individual who is not a university employee, the payment is processed through the Accounts Payable Office.
Students from other institutions with F, J, M or Q visas may be taxed at 14%.
Visitors who are not university employees are not typically taxed if their visa allows travel reimbursement.
Contact an HR Expert before making payments to student visa holders from outside the university or those not employed by the university. If the NRA does not have a Social Security number, contact HR for a temporary number to enter into BASIS.
Employee Awards and Prizes
Departments must contact an HR Expert for verification before the award or prize is given. Payments are processed through payroll and will be taxed at 30% with no exceptions. Award or prize money is reported on a 1042S form; NRAs may be eligible for a tax refund.
Student Awards and Prizes
No checks will be issued for NRA student awards and prizes without the completion of GLACIER . Contact an HR Expert to begin the GLACIER process. Payments are processed through payroll and will be taxed at 30% with no exceptions. Award or prize money is reported on a 1042S form; NRAs may be eligible for a tax refund.
Paying NRAs Honoraria, Speaker Fees, Consulting Payments
All accounts payable (including Foundation payments) made to NRAs, must be initiated with an HR Expert and require the following information:
- Payee's full name
- Email address
- Visa status
- Payment amount
- Reason for payment
Payments to NRAs are taxed at a 30% rate, unless there is a tax treaty exemption. The nonresident alien HR Expert initiates the tax treaty form process through GLACIER, the university's online tax compliance system. To receive the tax treaty exception, the payee responds to an email, completes the GLACIER forms and faxes the documents to HR. Tax is calculated based on eligibility. Independent contractors who are tax residents of these countries may be eligible for a tax treaty exemption.
If the NRA does not have a SSN or Individual Taxpayer Identification Number (ITIN), HR issues a temporary SSN, valid for 60 days, to NRAs who have completed and returned the GLACIER forms to HR. The NRA can apply for an ITIN when filing tax returns.
Contact an HR Expert for instructions on completing BASIS applications for NRA taxes.