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Non-Resident Alien Taxation

Non-Resident Alien Taxation. OSU Payroll Office Anita Gurule (541) 737-0573 anita.gurule@oregonstate.edu. Outline of presentation . Form W-4 - Non-Resident Filing Requirements CO-NRA - The Non-Resident Alien Information Request Form Tax Treaties - What, Why and When.

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Non-Resident Alien Taxation

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  1. Non-Resident Alien Taxation OSU Payroll Office Anita Gurule (541) 737-0573 anita.gurule@oregonstate.edu

  2. Outline of presentation • Form W-4 - Non-Resident Filing Requirements • CO-NRA - The Non-Resident Alien Information Request Form • Tax Treaties - What, Why and When

  3. Non-Resident Alien W-4 Filing REQUIREMENT • Box 3 - Single • Box 5 - 1 Allowance • Non-Residents are not allowed to file EXEMPT

  4. MEXICO, CANADA & KOREA Box 3 - Must file Single Box 5 - May file more than 1 allowance INDIA - STUDENTS ONLY! Box 3 - Must file Single Box 5 - May file more than 1 allowance Exceptions to the Non-Resident W-4 Filing Requirement

  5. The W-4 Default • If the Non-Resident Employee refuses to file a W-4 as outlined in the W-4 requirement - then income taxes will be withheld at the rate of Single - Zero allowances, the maximum rate. Cf. Treas. Regs. 31.3402.(f)(2)-(1)e

  6. Please Remember for the W-4! • For any employee: If the W-4 has been altered (ie. Allowances scribbled out and re-written) the W-4 will be defaulted to Single-0 and the employee will be required to file a new W-4. • University ID# must not be used on the W-4. We must have the employees SSN.

  7. W-4 Exercise -What is wrong with these W-4’s? • Form 1 NRA filed exempt • Form 2 Allowances scratched out • Form 3 University ID # instead of SSN

  8. CO-NRA - Oregon University Systems Alien Information Request Form • Payroll and the OUS Controller’s office use the CO-NRA to determine an employee’s tax status. • The CO-NRA is required for all Non-Resident Alien employees, including those with H1-B and TN visas.

  9. Important Details - CO-NRA • Copies of the I-94 and I-20 or DS-2019 (formerly the IAP-66) must accompany the CO-NRA. • It is important to use a current CO-NRA (check the year on the backside of the form). • The employee must complete and sign the CO-NRA. By signing it, they are verifying the information on it is correct.

  10. Tax Treaties - Form 8233 • 46 Available tax treaties for employees of OSU. • Not guaranteed that an employee is eligible for a tax treaty. • Country and status type (teaching / research vs. student / trainee) specific.

  11. More on Tax Treaties... • The 8233 must be accompanied by an Attachment Letter provided by the OUS Controller’s Office. Attachment Letters are available in the Payroll Office. • Please contact me if you have any questions concerning a tax treaty. • More information concerning tax treaties is available in IRS Publication 901.

  12. Tricky Tax Treaties • US/Canada Treaty is retroactively taxable if the employee earns more than $10,000 during the calendar year. • US/Germany Treaty for Students is retroactively taxable if the student visit exceeds 4 years. • Teaching/Research Treaties with India, The Netherlands, Thailand, and the UK are retroactively taxable if the visit exceeds two years.

  13. Non-Resident Alien FICA Exemption • Non-Resident Alien Employees in F, J, M or Q Visa status are FICA exempt. • Only while employee is a Non-Resident and employment is consistent with the purpose of the visit.

  14. Additional Resources • IRS Publication 519 - U.S. Tax Guide for Aliens • IRS Publication 15 - Circular E, Employer’s Tax Guide

  15. Any Questions?

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