The University of Washington is a withholding agent for the Internal Revenue Service (IRS) and is required to withhold tax.
All employee wages are taxable unless specifically exempt from tax by a US law or a treaty. Scholarships/fellowships paid to a foreign national from a US source is taxable unless specifically exempt from tax by a US law or a treaty.

Tax Treaties

• A tax treaty is negotiated between the United States and a foreign country. The purpose is to reduce double taxation on residents of the particular country.
• Tax treaty information is available in the following publications:
  • IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities
  • IRS Publication 901, Tax Treaties

Foreign National Employee

• Social Security number is required for wage reporting to the IRS
• Social Security number or ITIN is required to claim tax treaty benefits. 
• Reviews IRS Publications and makes an initial tax treaty eligibility assessment

Wage Payments to Employees

• Eligible for wage tax treaty
  • Completes IRS Form 8233 and the tax treaty article.
  • IRS Forms 8233 must be renewed each calendar year 
    • IRS Form 8233 for claiming tax treaty exemption (SSN required)
       
    • Tax Treaty Articles for 8233 documentation (SSN required)
       
    • Instructions for Form 8233 
  • Current list wage tax treaties available in IRS Publication 901, Carefully read chart for required criteria specified in tables and all footnotes.
• Not eligible or not claiming wage tax treaty
  • Submits IRS Form W-4 Employee’s Withholding Allowance Certificate
  • Withholding will default to single and zero allowances if IRS Form W-4 is not submitted
  • Special rules apply to nonresident aliens for tax purposes filling out IRS Form W-4
    • Form W-4 (SSN required)
    • Instructions for Form W-4

Foreign National Scholarship/Fellowship Recipients

• Eligible for Scholarship/Fellowship tax treaty
  • Completes IRS Form W-8BEN Beneficial Owner's Certificate of Foreign Status for U.S. Tax Withholding
  • IRS Form W-8BEN must be renewed each calendar year 
    • IRS Form W-8BEN for claiming tax treaty exemption (SSN or ITIN required)
    • Instructions for Form W-8BEN
  • If receiving both wage and scholarship/fellowship payments then IRS Form 8233 can cover both tax treaties and IRS Form W-8EN is not needed.
  • Current list of Scholarship/Fellowship tax treaties available in IRS Publication 901. Carefully read chart for required criteria specified in tables and all footnotes
• Not eligible or not claiming Scholarship/Fellowship tax treaty
  • Scholarship/Fellowship payments subject to 14% Federal withholding tax

The Payroll Office will review documents and make a determination of eligibility.

• If Payroll determines that foreign national is eligible:
  • A refund will be made for any federal income tax previously withheld during the current calendar year, up to the tax treaty exemption dollar limit.
  • Federal income tax will not be taken out of future paychecks until the tax treaty exemption dollar limit is reached.
• If Payroll determines that foreign national is not eligible:
  • Payroll takes no action and the foreign individual is not notified directly.
  • If the foreign national does not agree, the only recourse is to file a claim with the IRS on their personal tax return.
     

Failure to supply the required documentation may result in incorrect taxation