Can a nonresident alien avoid U.S. income tax withholding on taxable payments received from MSU?
In most cases, MSU is required to withhold income taxes from payments made to nonresident aliens for income earned in the United States. Those NRA who qualify under a number of different circumstances may avoid income tax withholding. The NRA must provide MSU with his/her U.S. tax identification number when completing the appropriate form. Independent personal services: The NRA may be eligible for exemption from withholding if they qualify for the benefits of a tax treaty between his/her country of residence and the U.S. A tax treaty is an agreement between the U.S. and another nation that documents a protocol for each country (home country and host country) to follow in taxing one another’s residents when that resident earns income in the “host” country. IRS Form 8233 must be completed. Services performed by a NRA corporation, partnership or fiduciary: The NRA entity must complete IRS Form W-8ECI or W-8BEN. Services performed by a NRA tax-exempt organization: The NRA organization must
