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Individual Tax Return
Instructions for Form 1040
Request for Taxpayer Identification Number (TIN) and Certification
Request for Transcript of Tax Return

 

Employee's Withholding Allowance Certificate
Employer's Quarterly Federal Tax Return
Employers engaged in a trade or business who pay compensation
Installment Agreement Request

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Rules Governing Practice before IRS

Aliens Employed in the U.S.

Any employer who hires aliens (non-U.S. citizens or residents) to perform services within the United States must follow these general procedures with respect to the reporting and withholding of federal income taxes:

  1. Identify all aliens (non-U.S. Citizens) on the company's payroll.
  2. Divide the aliens into two groups: "Resident Aliens" and "Nonresident Aliens" as defined by Internal Revenue Code section 7701(b), which defines residency status for aliens. Refer to Determining Alien Status for more information on the residency status of aliens.
  3. For income tax withholding purposes, treat resident aliens the same as U.S. Citizens.
  4. For income tax withholding purposes, treat nonresident aliens according to the following special withholding rules that apply to nonresident aliens, as described in Chapter 9 of Publication 15 (Circular E) and Publication 515, Withholding Taxes on Nonresident Aliens.

Exceptions to Mandatory Withholding of Federal Income Tax on Nonresident Aliens:

  1. Wages or Nonemployee Compensation are exempt from withholding of federal income tax if all 3 of the following conditions are met (per IRC 861(a)(3) and 864(b)(1)):
    • The nonresident alien performing services is present in the U.S. for a total not exceeding 90 days in a taxable year;
    • The compensation for such services does not exceed $3,000; and
    • The nonresident alien performs the services as an employee of, or under contract with, a nonresident alien individual, a foreign corporation, or a foreign partnership not engaged in a trade or business in the U.S. or the foreign office of a U.S. citizen or resident alien individual, a U.S. corporation, or a U.S. partnership (including from within a U.S. possession).

 

  1. Wages or Nonemployee Compensation are exempt from withholding of federal income tax if both the following 2 conditions are met (per IRC 872(b)(3)):
    • The nonresident alien is present in the U.S. in F, J, M, or Q nonimmigrant status; and
    • The compensation for services is paid by a nonresident alien individual, a foreign corporation, or a foreign partnership or the foreign office of a U.S. citizen or resident alien individual, a U.S. corporation, or a U.S. partnership (including from within a U.S. possession).

References/Related Topics

Note: This page contains one or more references to the Internal Revenue Code (IRC), Treasury Regulations, court cases, or other official tax guidance. References to these legal authorities are included for the convenience of those who would like to read the technical reference material. To access the applicable IRC sections, Treasury Regulations, or other official tax guidance, visit the Tax Code, Regulations, and Official Guidance page. To access any Tax Court case opinions issued after September 24, 1995, visit the Opinions Search page of the United States Tax Court.