Handbook for Payments to International Visitors
Office of Accounting
Office of International Services
Updated April 18, 2002
Payments to Nonresident Aliens for
A payment to an international visitor for a fellowship is authorized by a Fellowship Award Authorization (Scholarships, Fellowships, Trainee Stipends, and Other Awards). The Award Authorization is completed by the Department and is forwarded to the Office of Grants Management. After approval by the Office of Grants Management, the form is sent to the Office of International Services for approval as to the eligibility of the international visitor for payment under U.S. Immigration law. The Office of Accounting is responsible for processing the periodic payments If the international visitor is considered a “Nonresident Alien” (NRA) for tax purposes, IRS withholding at a rate of 14% is required The only exception is if payments are specifically exempted by a tax treaty between the United States and the country of official residence of the NRA. The IRS requires that payments to the NRA , and any withholding, be reported annually to the NRA and the IRS on IRS Form 1042S.
No withholding is required if the international visitor is considered a “Resident Alien” for tax purposes. Payments are reported to the resident alien by letter in the same manner stipend payments are reported to United States citizens In addition, IRS Form W-9, Request for Taxpayer Identification Number and Certification should be obtained.
1. Upon preparation of the Fellowship Award Authorization, the department should consult with the Office of International Services if an international visitor will be at UTHSCSA and if a payment will be made to the international visitor for a fellowship. Considering the individual facts, the Office of International Services will advise the department as to the type of Visa and other entry credentials which are required in order for the international visitor to be eligible for payment for the fellowship under US Immigration laws.
2. The following information must be obtained from the NRA and attached to the Award Authorization. This information is in addition to the normal documentation requirements of the Grants Management Office:
· Foreign National Information Form questionnaire completed and signed by the NRA.
· Taxpayer Identification Number, if any: Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) OR a statement stating that a TIN was requested but was not provided by the individual.
· IRS Form W-9, Request for Taxpayer Identification Number and Certification, if individual is a “Resident Alien”.
· Completed and signed IRS Form W-8 BEN, if individual is a “Nonresident Alien”..
· Copy of passport page(s) with biographical data and expiration dates.
· Copy of Form I-94, Arrival/Departure record, US Immigration.
· Copy of Form DS-2019 (J-1 visa); copy of Form I-20 (F-1 visa); or copy of Form I-797 (H-1 visa).
3. TAXPAYER IDENTIFICATION NUMBERS: The IRS requires nonresident aliens to have a taxpayer identification number (TIN) in order to file a U.S. tax return and to claim an exemption from withholding under a tax treaty. A TIN is either a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN). All employees of the UTHSCSA are required to have a SSN.
A Nonresident Alien receiving a stipend should qualify for a SSN. If the individual does not have a SSN, a SS-5, Application for a Social Security Number, should be completed and filed in person at the local Social Security Office.
4. The Fellowship Award Authorization and supporting documentation is then forwarded to the Office of Grants Management for payment approval.
5. The Office of Grants Management reviews the Award Authorization and forwards the approved form and supporting documentation to International Services .
6. International Services determines that the NRA is eligible for payment for the fellowship under U.S. immigration laws. A “U.S. Nonresident Alien Approval Form” is completed and signed and forwarded with the Award Authorization and supporting documentation to the Office of Accounting.
7. The Office of Accounting reviews the Award Authorization and supporting documentation, including verification of International Services approval as evidenced by the International Services Approval Form. Periodic payments are then scheduled as authorized on the Award Authorization.
8. The accounting office reports gross amounts paid, together with any amount withheld, to the NRA and the IRS annually on Form 1042S as required by IRS regulations.
9. Account numbers utilized for stipend payments: