Foreign Nationals Working in the U.S.

Inviting a Foreign National to UNCSA can have unexpected challenges. The different visas that are available to Foreign Nationals often have different requirements that must be met in order for the individual to legally visit UNCSA. Please consult with the Controller’s Office prior to inviting any Foreign National to UNCSA. In order to process a payment to a Foreign National, whether it’s a scholarship or honorarium or to cover travel costs, the University requires certain information.

This website will help guide you to the necessary forms, policies, and procedures that should be followed in order to properly pay a Foreign National. The information on this site may be used as a guide by UNCSA faculty, staff, and foreign visitors (Students, Teachers, and Guest Lecturers) and serve as a reference tool for University personnel that interact with foreign visitors who have a financial relationship with UNCSA.

A foreign national is defined simply as "an individual who is a citizen of any country other than the United States."

Certain types of payments to a foreign national may be taxable, while other payments to the same person are not. Also, payments that are taxable to one foreign national may not be taxable to another because of a tax treaty. It is important for the University to determine the taxability of each type of payment made to a foreign national in order to know whether withholding is required and the amount.

Note: UNCSA employees cannot provide personal, legal, or tax advice. Contact the IRS, your accountant or tax attorney for assistance.

Making Payments to Foreign Nationals

Payments That Can Be Issued to Foreign Nationals

The Tax and Immigration laws governing payments to foreign individuals are very complex. The following procedures are established to ensure the University’s compliance with the applicable laws. Foreign nationals are strictly limited in what sources of income they are authorized to accept and all payments are taxable unless an exception under a treaty or IRS code applies.

B-1, B-2, VWB, and VWT are prohibited from being employed but may be paid under the Honorarium Rule conditions.
F-1 and J-1 students may be employed on and off-campus under certain circumstances. Off-campus employment requires specific work authorization prior to accepting employment.
F-1 students may be eligible for 12 months of Optional Practical Training (OPT).
J-1 non-students may be employed on campus.
H-1B, O, and E-3 visas are restricted to temporary workers in specialty occupations.
TN visas are restricted to Mexicans and Canadians workers in specialty occupations.

Award, Prize or Research Subject

Payment as a reward or recognition for a special achievement such as winning a judged competition or payment for participation as a research subject. Standard taxation rate: 30%

Verify that Payment Can Be Issued to Foreign National.
Download Award, Prize or Research Subject Payments to a Foreign National.

Employee Wages

Payments for services that an individual performs or carries out for the University as an employee. A foreign national teacher/researcher is teaching or conducting research in a permanent employment position at UNCSA.

Unless exempted by a tax treaty, earnings are subject to federal and state income tax withholding calculated from a graduated formula.

Verify that Payment Can Be Issued to Foreign National.

Honorarium

Payment to an individual for a presentation-oriented, guest lecture or invitational event. Standard taxation rate: 30%

Honorarium Payments Rules

Verify that Payment Can Be Issued to Foreign National.
Download the Eligibility Determination Request for Payment to/on behalf of Foreign Individuals
Download Honorarium Payments to a Foreign National.
Check IRS Publication 515 for available tax treaty
- IRS Form 8233 – Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual, Instructions

Independent Contractor and Performer Services

Payments for services performed by individuals who are not employees and who meet the criteria for Independent Contractor Certification Form 303. Standard taxation rate: 30%

Verify that Payment Can Be Issued to Foreign National.
Download Independent Contractor or Performer Service Payments to a Foreign National.
Complete Independent Contractor Certification Form 303
Foreign National completes Foreign National Payment Data Sheet
Check IRS Publication 515 for available tax treaty
- IRS Form W-BEN-E - Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities), Instructions
- IRS Form W-8BEN – Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals), Instructions
- IRS Form 8233 – Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual, Instructions

Royalty or Rent

Payments made for the use of intangible (royalty) or tangible (rent) property. Various tax rates apply up to 30% withholding - refer to IRS Publication 515 for specific details.

Download Royalty or Rent Payments to a Foreign National.
Check IRS Publication 515 for available tax treaty
- IRS Form W-8BEN – Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals), Instructions
- IRS Form W-8EXP – Certificate of Foreign Government or Foreign Organization for United States Tax Withholding, Instructions

Scholarship and Fellowship Awards – paid through Student Accounts

A one-time payment to assist a student in pursuing a course of study or research. Generally not considered taxable income if the recipient is a candidate for a degree and the award is used to pay for tuition, fees and/or other mandatory books, supplies, and equipment required for all students in course of study.

Scholarship, Fellowship Payments to a Foreign National

Verify that Payment Can Be Issued to Foreign National.
Foreign National completes the Foreign National Information Form.
Check IRS Publication 515 for available tax treaty
- IRS Form W-8BEN – Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals), Instructions

Service Payments to a Foreign Entity

Payments made to foreign companies or entities. Standard taxation rate: 30%

Verify that Payment Can Be Issued to Foreign National.
Download Service Payments to a Foreign Entity.
Check IRS Publication 515 for available tax treaty
- IRS Form W-8BEN – Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals), Instructions
- IRS Form W-8EXP – Certificate of Foreign Government or Foreign Organization for United States Tax Withholding, Instructions

Stipend – paid through Payroll

Ongoing payment intended to support an individual engaged in the academic activity at the UNCSA. Standard taxation rate: 14%.

Stipend Payments to a Foreign National

Verify that Payment Can Be Issued to Foreign National.
Check IRS Publication 515 for available tax treaty
- IRS Form W-8BEN – Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals), Instructions

Travel Reimbursements

Payments for expenses incurred while traveling on University business are generally not considered taxable income.

Verify that Payment Can Be Issued to Foreign National.
Download Travel Reimbursement Payments to a Foreign National (no honorarium)