Foreign students and scholars may be eligible to claim tax treaty benefits if certain criteria are met. Each treaty has a variety of terms and clauses that will affect whether you can claim an exemption from tax withholding.
First, the United States and your country of residence must have a treaty provision. Second, you must meet the eligibility requirements for that treaty. See Tax Treaty Countries for a list of treaty countries and types of treaty exemptions of each country. Also see IRS Publication 901- U.S. Tax Treaties for more information.
The type of form you use to claim treaty benefits depends on the type of income you're paid under the treaty provision, and whether you're a nonresident alien or U.S. resident for tax purposes.
Use forms 8233 and Tax Treaty Affidavit if you are a nonresident alien for tax purposes. Form 8233 expires at the end of each calendar year, so you must submit a new one each year you're eligible to claim treaty benefits.
Use forms W-9 and Attachment to Form W-9 if you are a resident for tax purposes. Once filed, these forms remain valid indefinitely until your circumstances change (for example, you become a "green card" holder or citizen, or your treaty time limits run out).
The University of Minnesota uses Thomson Reuters International Tax Navigator / Foreign National Information System (FNIS) software to determine your payroll tax status, including substantial presence and tax treaty eligibility according to IRS regulations. New Hire Foreign National employees are sent instructions on how to complete their FNIS data entry.
For questions regarding FNIS data entry and accessing the software, or for more information about tax treaty eligibility and benefits, email or call the Office of Human Resources Contact Center at ohr@umn.edu, 612-624-8647, or 800-756-2363.
If your wages are exempted from income tax withholding because of a tax treaty, Payroll Services will send you IRS Form 1042-S at the end of the year to use when filing your annual tax return.