Federal and State Tax Reporting

A W-8BEN is required when making tax reportable payments, as UW is required to obtain the following information on all potentially reportable payments:

• legal name,
• permanent mailing address, and
• U.S. Taxpayer Identification Number (Social Security Number (SSN), Individual Taxpayer Identification Number (ITIN), Federal Employer Identification Number (FEIN or EIN).

All payments to nonresident aliens, regardless of amount, which represent compensation for services, rent, royalties, prizes and awards, training stipends, scholarships, and fellowships are reported to the individual and the Internal Revenue Service (IRS) on Form 1042-S. These payments must be processed on the Payment to Individual Report (PIR). All payments must include certain required documentation and are subject to immigration and visa restrictions. All payments reportable on Form 1042-S require a permanent mailing address and country of residence on the Payment to Individual Report (PIR). If the individual is claiming exemption or a special withholding rate for non-scholarship/fellowship payments, IRS Form 8233 must be completed, signed, and attached.  The 1042-S forms will be prepared and mailed by Accounting Services no later than March 15 of each year.

A Nonresident Alien (NRA) is an individual whose residence is not within the United States and who is not a U.S. citizen. A Resident Alien is an individual who is a lawful permanent resident of the United States at any time during the calendar year. This is known as the “green card” test. Alternatively, an alien is considered a U.S. resident if the individual meets the “substantial presence” test for the calendar year.  Under this test, the individual must be physically present in the United States or present at least:

1. 31 days during the current calendar year, AND
2. 183 days during the current year and the 2 preceding years, counting all the days of physical presence in the current year but only 1/3 the number of days of presence in the first preceding year and only 1/6 the number of days in the second preceding year.

However, individuals present in the U.S. under a J or Q non-student visa are considered “exempt individuals” until they have been present for two calendar years out of the last six years. Therefore, they do not begin to count days of presence toward the presence test until they are no longer “exempt individuals”. Students present in the U.S. under F, J, M or Q student visas are considered “exempt individuals” until they have been in the U.S. for any part of five calendar years.

For more information on resident and nonresident status, the tests for residence, and the exceptions to them see the IRS Publication 519, U.S. Tax Guide for Aliens. You may call the Internal Revenue Service at 1-800-829-3676 (1-800-TAX-FORM) for a copy or visit the IRS website.

All categories of J-1 exchange visitors are eligible for social security numbers and should apply at a Social Security Administration office or at a U.S. Embassy or Consulate.  F-1 and J-1 students who are not employed are not eligible for social security numbers, and should apply for an ITIN by filing IRS Form W-7 at a local IRS office or at through the UW Tax Compliance Office. Contact a Dean’s office or Accounting Services for more information. After application has been made for either a social security number or ITIN, but the number has not yet been received, enter “applied for” and the date of application on the PIR. When the individual receives the number from Social Security Administration or IRS, (s)he must provide the number to their paying department and the Accounting Services Tax Compliance Office.

For more information on Visa requirements and the tax issues to consider when paying non-resident aliens, see our Visa Restrictions and Resources guide.

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