Requirements for Payments to Foreign Nationals, Nonresident Aliens (NRAs)
This directive establishes the proper methods of making employment, independent contractor/honorarium, and fellowship payments to foreign nationals and nonresident aliens (NRA).
Reason for Directive
Payments made to foreign nationals or nonresident aliens (NRAs) are subject to withholding tax requirements on their U.S. source income. Therefore, all payments to foreign nationals or NRAs must be approved by Payroll Services before Payroll or Disbursements can issue any payment.
Who must comply?
All departments processing a payment to a foreign national or nonresident alien.
Step-by step instructions for hiring a foreign national, including using the Foreign National Information System (FNIS), are outlined in the Employment Hub.
Non-employee payments to a Foreign Corporation that is performing services in the U.S. require the following documentation:
- Form W8-BEN-E and mark Box 10 for ZERO percent withholding
- The foreign corporation must have a U.S. Employer Identification Number (EIN) to receive tax treaty benefits. If they do not have a U.S. EIN: Complete IRS Form SS-4 and mail it to the IRS to obtain one. Note: If the university does not receive a U.S. EIN it is required by law to withhold 30% tax on the payment.
Send the completed form W-8BEN-E and all required documentation to Payroll Services at firstname.lastname@example.org.
03/31/2023: reviewed content
Payroll Services: 392-1231
Disbursement Services: 392-1241