NRA (Non Resident Alien)

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Nonresident Alien

Reference Guide

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Definition

Nonresident Alien (NRA) is defined as any employee who is NOT a United States

Citizen or a Permanent Resident (Resident Alien or Green Card holder).

Responsibilities

 Meet with a representative from the Office of International Education upon

arrival to the campus.

 Provide all required documents by the established timeline

 Maintain legal status at all times. It is the NRA’s responsibility to ensure

there is adequate planning time to maintain their legal/work status.

 Notify the Office of International Education of visa changes.

 Notify the Department Payroll Representative of visa changes, tax status,

change of address, healthcare benefits, etc.

It is required by the University of Maryland System and Central Payroll Bureau

that all NRA’s must complete a Citizenship Status Form (CSF) and

accompanying tax documents in November of each year. Completed forms are

then given to the Department Payroll Representative.

NOTE: ANY EMPLOYEE IN THIS STATUS IS RESPONSIBLE FOR

ENSURING THAT THEY MAINTAIN THEIR VISA AND IF APPLICABLE,

CURRENT WORK AUTHORIZATION.

General Information

NRAs are required to have a valid social security number. Temporary numbers

may only be used if the person has a valid receipt or application from the Social

Security Administration showing that an application has been submitted for a

permanent social security number.

Once the employee receives the permanent social security card, the hiring

department (or primary department) must submit a Change PAR Form to update

the temporary number to the valid social security number.

The following documentation is necessary to complete this transaction:

 Change PAR form (action inclusive of: social security number change)

 Copy of the social security card

 Citizenship Status Form ((Supporting documents such as United States

visa, I-94, I-20, IAP66, etc.)

 W-4 Form

 I-9 form

NRA’s must have valid social security numbers to receive tax treaty exemption

benefits.

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All NRAs are required to pay State of Maryland Income Taxes. There is no treaty

exemption for NRAs from Maryland State Income taxes.

Please Note: Any employee who lives in Virginia or Pennsylvania may be

exempt from paying Maryland State Income taxes regardless of visa status.

U.S. Tax - Tax Resident Status

The Internal Revenue Service recognizes four categories for tax residency

status. These are NOT Immigration categories.

 United States Citizen

 Permanent Resident Alien

 Resident Alien for tax purposes

 NRA for tax purposes

When UMBC makes a payment to someone who is not a U.S. Citizen or

Permanent Resident Alien, federal law determines whether the person meets the

tax residency criteria of:

 Resident Alien for tax purposes (RA)

 Nonresident Alien for tax purposes (NRA)

The Substantial Presence Test (SPT) is used to determine whether the individual

is a Resident Alien (RA) or NRA. The key factors of the substantial presence test

are the history of U.S. visits and the immigration classification during those visits.

The form used to calculate this information is the Citizenship Status Form (CSF).

An annual renewal is required. The Citizenship Status form (CSF) for the current

calendar year can be found on the HR website.

http://www.umbc.edu/hr/Payroll/indexnew.html

If the information for the Substantial Presence Tax is not available, Central

Payroll Bureau, by law, presumes the individual is a NRA and withholds tax

accordingly.

A Resident Alien (RA) for tax purposes is subject to the same tax regulations as

a U.S. Citizen.

Payment for services performed by a NRA outside the U.S. is considered “foreign

source” income. Therefore, it is not taxable in the U.S. However, it may still be

taxable in the home country.

NRA and Resident Alien (RA) definitions apply only to federal taxes. They do not

apply to state taxes.

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Tax Treaties (Representative Letters)

 An income tax treaty is an agreement between the United States and a

foreign country to minimize double taxation.

 Certain taxable payments made to foreign nationals may be exempt from

(not subject to) U.S. taxes based on the terms of the income tax treaty

between the U.S. and a foreign national’s country of tax residency.

 The U.S. maintains tax treaties with over 60 countries throughout the

world.

 No two treaties are alike

 Tax Treaty exemptions are typically for a specified number of years and

specified money amount.

 Income tax treaties apply to federal tax not to state tax. The State of

Maryland does not recognize tax treaties.

Listed below are the countries that have agreements with the U.S. The actual

Representation Letter and form 8233 [exemption from withholding for

independent (and certain Dependent) Personal Services for a NRA individual can

be found on the HR website. http://www.umbc.edu/hr/Payroll/indexnew.html

Tax Treaty Tips:

1. BACK TO BACK CLAUSE: prevents an individual from claiming the exemption:

a. during a period that immediately follows one in which he/she has claimed a

“student/trainee” exemption, or

b. for the same purpose on multiple occasions.

The individual must re-establish residency in her home country (1 year), then re-enter

the U.S. to claim a Treaty benefit.

2. ONCE IN A LIFETIME CLAUSE: the “Teacher/Researcher” exemption may be used

only ONCE by an individual. Re-establishing residency does not permit use of this

exemption. The treaties that have this clause are: the Czech Republic, France,

Indonesia, Portugal, and Slovak Republic.

3. RETROACTIVE CLAUSE: Time Limits. Some treaties require “retroactive” taxation

of all earnings if an exempted person has been present in the U.S., exceeding the

allowable time.

4. The whole exemption would be lost and would be taxable. Treaties that include this

restriction are: India, the Netherlands, the Philippines, and the U.K.)

(updated 04-28-2008)

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5. CHINA: does not have a back-to back clause, but does require that an individual who

has used the student exemption must re-establish residency in China before she is

allowed to use the teacher/researcher exemption.

Individuals using the tax treaty exemption must:

 Have a permanent Social Security Number.

 Submit, each calendar year, the following forms:

 W-4 form

 8233 form

 Representation letter

 Citizenship Status Form

 Use the appropriate representation letter for the “primary purpose” of coming to the

United States (check the I-20, DS-2019, H-1 Approval Notice). For example, a F-

1(student) on Optional Practical Training (OPT), whose title is “professor”, completes

the “Student” representation letter, not the “Teacher/Researcher” letter, because the

primary purpose for being in the U.S. is to be a student.

 Attach copies of appropriate immigration documents as required.

FICA Taxes

FICA consists of Social Security and Medicare Taxes which funds pension

payments for retired persons in the U.S., and medical insurance for retired

persons. Usually, F-1 and J-1 Nonresident Alien students are exempt when

enrolled a student, and J-1 nonresident alien teacher/researcher are exempt from

this tax. However, if an employee becomes a Resident Alien for tax purposes,

they would be subject to FICA taxes. F-1 & J-1 students may still be FICA

exempt under the "student FICA exemption" if enrolled & regularly attending

classes & working for the school where enrolled. U.S. tax law requires that you

pay the tax based on tax residency status, regardless of whether or not the

employee will receive benefits from the FICA taxes paid.

U.S. Taxes- Federal and State withholdings for Nonresident

Alien for Tax Purposes

A NRA subject to wage withholding must give the employer a completed

Employee Withholding Allowance Certificate (W-4 form) on wages paid to enable

the employer to withhold the appropriate taxes.

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In completing an Employee Withholding Allowance Certificate (W-4) form NRA

for tax purposes should follow the instructions below.

Section 2 - Federal Withholding Form W-4

 Check “single” on line 3 (regardless of actual marital status)

 Claim only one (1) withholding allowance on line 5, unless a resident of

Canada, Mexico or South Korea, or a U.S. national.

 NRAs are not permitted to claim “Exempt” from federal tax withholding.

Section 3- Maryland Withholding Form MW507, District of Columbia Withholding

Form D-4, and West Virginia Withholding Form WV/IT-104

 NRA can claim either “0 or 1” exemptions for State taxes.

 NRA can claim “exempt” from state taxes if living in Pennsylvania or

Virginia which is line 4.

The actual Withholding Allowance Certificate (W-4 form) for State of Maryland

Employees, State of Maryland Employees Residing in Washington, D.C., and

State of Maryland Employees Residing in West Virginia can be found on the HR

website.

http://www.umbc.edu/hr/Payroll/indexnew.html

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REPRESENTATION LETTERS FOR STUDENTS (updated 05-12-2011)

COUNTRY

ARTICLE

NUMBER

# OF EXEMPT

YEARS

EXEMPT DOLLAR

AMOUNT

(employees)

FELLOWSHIP

ARTICLE?

BANGLADESH

Student=no limit

(apprentice=2

years)

8,000

Yes

BELGIUM

2,000

Yes

BULGARIA

Student=no limit

(trainee=2 years)

9,000

PEOPLES REPUBLIC OF

CHINA (NOT HONG

KONG OR TAIWAN)

20(c)

Reasonable time

to complete

studies

5,000

Yes

COMMONWEALTH OF

INDEPENDENT STATES*

VI(d)

5 (fellows only)

N.A.

Yes

CYPRUS

21(1)

5 or time to

complete studies

2,000

Yes

CZECH REPUBLIC

5,000

Yes

EGYPT

3,000

Yes

ESTONIA

5,000

Yes

FRANCE

5,000

Yes

GERMANY

20(4)

9,000

Yes

ICELAND

9,000

Yes

INDONESIA

19(1)

2,000

Yes

ISRAEL

3,000

Yes

KAZAKHSTAN

5 (fellows only)

N.A.

Yes

S. KOREA

21(1)

2,000

Yes

LATVIA

5,000

Yes

LITHUANIA

5,000

Yes

MALTA

9,000

MOROCCO

2,000

Yes

NETHERLANDS

as long as full-

time

student/trainee

2,000

Yes

NORWAY

16(1)

2,000

Yes

PAKISTAN

XIII

no explicit limit

5,000

PHILIPPINES

22(1)

3,000

Yes

POLAND

18(1)

2,000

Yes

PORTUGAL

5,000

Yes

ROMANIA

20(1)

2,000

Yes

RUSSIAN FEDERATION

5 (fellows only)

N.A.

Yes

SLOVAK REPUBLIC

5,000

Yes

SLOVENIA

5,000

Yes

SPAIN

22(1)

5,000(-$3750

personal Exemption in

2011)

Yes

THAILAND

3,000

Yes

TRINIDAD & TOBAGO

19(1)

2,000

Yes

TUNSIA

4,000

Yes (Art.20a)

UKRAINE

5 (fellows only)

N.A.

Yes

VENEZUELA

5,000

Yes

*Former USSR treaty applies to:

Armenia,Azerbaijan,Belarus,Georgia,Kyrgyzstan,Moldova,Tajikistan,Turkmenistan,Uzbekistan.

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Representation Letters for Teachers/Researcher

Article #/country/special clauses

(21) Bangladesh

(20) Belgium – Back-to-Back Clause Teachers only.

(19) Bulgaria

(19) China - (DOES NOT INCLUDE HONG KONG or TAIWAN) 3 Year Exemption

(21) Czech Republic- Back to Back and Once in a Lifetime Clauses

(22) Egypt – Back-to-Back Clause (5 year TOTAL use if Student Article was used)

(20) France - ONCE IN A LIFETIME (5 year TOTAL use if Student Article was used)

(20<1>) Germany – Back-to-Back Clause

(XII) Greece – 3 Year Exemption (from date of arrival) Teachers/professors only.

(17) Hungary

(21) Iceland – Back-to-Back Clause (eligibility for student article qualifies as “use”)

(22) India – Retroactive Clause

(20) Indonesia – Once in a Lifetime Clause

(23) Israel – Back-to-Back Clause (5 year TOTAL use if Student Article was used)

(20) Italy

(22) Jamaica – Once in a Lifetime Clause

(20) Japan

(20) Korea - Back-to-Back Clause

(21) Luxembourg - Retroactive Clause

(21<1 >) Netherlands – Retroactive and Back-to-Back Clauses

(15) Norway – Back-to-Back Clause

(XII) Pakistan

(21) Philippines – Retroactive and Back-to-Back Clauses

(17) Poland – Back-to-Back Clause

Portugal - Back to Back and Once in a Lifetime Clauses

(19) Romania - Back-to-Back Clause (5 year TOTAL use if Student Article was used)

(21) Slovak Republic – Back to Back and Once in a Lifetime Clauses

(20) Slovenia - (5 year TOTAL use if Student Article was used)

(23) Thailand – Retroactive Clause (5 year TOTAL use if Student Article was used)

(18)Trinidad & Tobago - Back-to-Back Clause (5 year TOTAL use if Student Article was used)

(VI) U.S.S.R.- Armenia

(VI) U.S.S.R.- Azerbaijan

(VI) U.S.S.R.- Belarus

(VI) U.S.S.R.- Georgia

(VI) U.S.S.R.- Kyrgyzstan

(VI) U.S.S.R.- Moldova

(VI) U.S.S.R.- Tajikistan

(VI) U.S.S.R.- Turkmenistan

(VI) U.S.S.R.- Uzbekistan

(20) United Kingdom – Retroactive Clause

(21) Venezuela

All teacher/researcher articles are for 2 years from date of arrival unless otherwise noted.

11-08-2009.

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VISA Classifications

A-1, A-2, A-3: Staff of foreign embassies & members of their immediate family. A-3 are

attendants, servants of A-1, A-2. Clearance for any work beyond diplomatic work must

be given in advance by the Protocol Division of the Department of State. Will have

Employment Authorization Document (EAD).

B-1: Visitors for business. May be paid by foreign source; limited to reimbursement of

travel & per diem from U.S. source; no salary/honorariums.

B-2: Visitors for pleasure. May receive no payment whatsoever from any U.S. source.

B-2 Prospective Student Alien: Clear intent to study in the U.S.; will change to F-1

status. May receive no payment whatsoever from any U.S. source until visa has been

officially changed to F-1.

B-2 Prospective Exchange Visitor: Alien with clear intent to change to J-1 status for

study, research or teaching. May receive no payment whatsoever from any U.S. source

until visa has been officially changed to J-1.

C-1, C-2, C-3: Visitors in transit. May receive no payment whatsoever from any U.S.

source.

D: Foreign crewman. May be paid only for work done in connection with

shipping/transport.

E-1, E-2: Treat traders, treaty investors & their dependents. May be paid for business

and investing work used as justification for issuance of visa; no other work is legally

permitted.

F-1: Foreign students. On-campus work permitted by USCIS regulations (with

restrictions – i.e. 20 hours/week when school is in session, 40 hours/week during school

vacations); Off-campus work possible if employer has filed labor attestation or student

has been approved for practical training; Off-campus permission given on 3

page of I-

20 or on EAD.

F-2: Dependents of foreign students. May receive no payment whatsoever from any U.S.

source.

G-1, G-2, G-3, G-4, G-5: Employees of international organizations & their immediate

family members. G-5s are attendants, servants of G-1 to G-4. May be paid only by the

organization for which they received their G designation; no other work legally permitted.

Spouses & dependents may apply for special work permission from the Dept. of State.

H-1A: Registered nurses. Can only be paid by the facility that filed the labor attestation &

applied for the H-1A.

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H-1B: Temporary workers in a specialty occupation other than nurses, agricultural

workers, athletes or entertainers. Visa is job specific – can only be paid by the

organization which filed the petition for H-1 status.

H-2A: Aliens coming to U.S. to perform agricultural work of a temporary/seasonal

nature. Can only be paid by petitioner or original sponsor – Job specific.

H-3: A trainee. Cannot be paid by other than original sponsor or petitioner – job specific.

H-4: Dependents of H-1A, H-1B, H-2A, H-2B or H-3s. May receive no payment

whatsoever from any U.S. source.

I: Journalists, representatives of the media & their dependents. May work only for media

organization that obtained I visa for them.

J-1 Student: Students in the U.S. under Exchange Visitor Program. May work on- or off-

campus if granted permission by Exchange Visitor sponsor.

J-1 Professor & Research Scholar: Researchers, professors, scholars here under

Exchange Visitor program. May work for university academic department or organization

that issued or is listed on DS-2019 form; permission for other work granted by petition to

U.S. Information Agency.

J-1 Short-term Scholar: Short-term researchers & professors. Limited to 6 month stay.

No extensions permitted. May work for the university academic department or

organization that issued or is listed on DS-2019 form; permission for other work granted

by petition to U.S. Information Agency.

J-2: Dependents of J-1 Exchange Visitors. May request work authorization from USCIS

so long as monies earned will not be used to support the J-1; work permission is shown

on EAD.

K-1: Fiancés of U.S. citizens. May request work authorization upon entry to U.S.;

permission shown on EAD. Must marry U.S. citizen w/in 90 days & apply for permanent

residence.

L-1: Intra-company transfers – i.e. managers, executives who have worked abroad for

branch of U.S. firm. May work only for the company that obtained L-1 visa; no other work

permitted.

L-2: Dependents of L-1s. May receive no payment whatsoever from any U.S. source.

M-1: Students at vocational schools. May receive permission to work for six months after

completion of studies; shown on EAD.

M-2: Dependents of M-1s. May receive no payment whatsoever from any U.S. source.

NATO 1-7: Aliens from NATO member countries in the U.S. under sponsorship of NATO

for study, research, or training. Payment limited to funds provided through NATO award.

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O-1: Alien who has extraordinary ability in the sciences, arts, education, business,

athletics, motion pictures or T.V. May be paid only by the organization that petitioned.

O-2: Alien coming to U.S. solely to assist in the artistic or athletic performance by an O-

1. May be paid only by the sponsor of the O-1 alien.

P-1: Alien coming to U.S. to perform at a specific athletic competition. May be paid only

by the sponsoring organization.

P-2: Alien coming to U.S. to perform as artist or entertainer. May be paid only by

sponsoring organization.

P-3: Alien coming to perform as an artist or entertainer in a culturally unique program.

May be paid only be sponsoring organization.

P-4: Dependents of P-1, P-2, P-3s. May receive no payment whatsoever from any U.S.

source.

Q: Alien coming to participate in an int’l exchange program for sharing of attitudes,

customs, history, heritage, philosophy and/or traditions of alien’s country. May be paid

only by sponsoring agency.

R: Alien who is a member of a bona fide nonprofit, religious organization in the U.S. May

be paid only by sponsoring agency.

S: Federal Witness. Not eligible for change to another non-immigrant status.

TN: Professional from Canada or Mexico who entered the U.S. under NAFTA

agreement. Employment is restricted to the employer sponsoring the TN.

TD: Dependents of TN professional. May receive no payment whatsoever from any U.S.

source.

WB: Visa Waiver Business. Limited to countries participating in the Visa Waiver Pilot

Program. Maximum stay of 90 days; cannot be extended or changed to another visa

status. Reimbursement for travel and per diem only; no salary or honorariums.

WT: Visa Waiver Tourist. Limited to countries participating in the Visa Waiver Program.

Maximum stay of 90 days; cannot be extended or changed to another visa status. May

receive no payment from any U.S. source.

Asylum Applicants: Those who have filed for asylum in the U.S. May request work

authorization; permission shown on special card.

Asylees/Refugees: Those granted asylum or refugee status. May request work

authorization; permission shown on EAD.

Pending Immigrants: Those who have filed for adjustment to Immigrant status. May

request work authorization; permission shown on EAD.

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Immigrants (Permanent Residents/Resident Aliens): Those who have been granted

residence in the U.S. No limits on employment; status shown on Green Card.

Temporary Residents: Those who have been approved for legalization after having

been here in illegal status for 5 years. May request work authorization for the year (or

longer) it will take to obtain permanent residence; permission shown on EAD.

Conditional Permanent Residents: Those who have applied for immigrant status

through marriage to U.S. citizen or permanent resident. No limits on employment;

permission on EAD.

Undocumented Aliens: Those who have entered the U.S. illegally or who lost legal

status. Not eligible for employment.

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TAX FORMS REQUIRED FOR NON-RESIDENT/RESIDENT

ALIENS

FYI: NONRESIDENT ALIENS WITH A TEMPORARY SOCIAL SECURITY NUMBER

CAN NOT USE A TAX TREATY.

TAX TREATY FORMS MUST BE FILED CORRECTLY BY THE CURRENT YEAR

END DEADLINE TO BE EXEMPT FROM FEDERAL TAXES ON JANUARY 1 OF

THE NEW YEAR

Key: NRA= Nonresident Alien

W4= Employee withholding allowance certificate

CSF= Citizenship status form

W-9= Request for taxpayer identification number

8233= IRS form 8233, December 2001

Rep. Letter= Representation letter or attachment for 8233 form

W-4, CSF, W-9, W- 9 Attachment, 8233, and Representation Letters can be found here:

http://www.umbc.edu/hr/Payroll/NRA.html

CITIZENSHIP STATUS

FORMS

WHEN FILED

HOW THE W-4 CAN BE

COMPLETED:

Permanent Resident

CSF

W-9

Once- Upon

Hire

As a US Citizen

Resident Alien for tax

Purposes

W-4

CSF

W-9

Renew every

calendar year

As a US Citizen

NRA for tax purposes, no

Tax Treaty applies:

W-4

CSF

Renew every

calendar year

Must file single

Federal is 0 or 1

State is 0 or 1

Cannot use line 7

NRA for tax purposes,

Tax Treaty applies:

W-4

CSF

8233 (Oct, 2001)

Rep. Letter

Renew every

calendar year

Must file single

Federal is 0 or 1

State is 0 or 1

Cannot use line 7

NRA for tax purposes,

Tax Treaty applies:

H-1 Needs a W-9 & a W-9

Attachment

W-4

CSF

8233 (Oct, 2001)

Rep. Letter

Renew every

calendar year

Must file single

Federal is 0 or 1

State is 0 or 1

Cannot use line 7

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NONRESIDENT ALIEN REQUIRED DOCUMENTS

CLASSIFICATION

REQUIRED ATTACHMENTS MUST BE SUBMITTED WITH THE

PAYROLL DOCUMENTS AND CITIZENSHIP STATUS FORM

Permanent Resident

Resident Alien Card or I-551 Stamped from passport OR

Copy of USCIS approval letter

Permanent Resident

Applicant

A valid (unexpired) Employment Authorization Card OR

Letter from INS stating Permanent Resident application has been processed

OR A stamped Passport indicating “Processed for I-551”

Asylee, Refugee, or TPS

Valid Employment Authorization Card OR

Copy of Notice of Adjustment of Status from (USCIS) OR

Copy of stamp from passport OR

Copy of I-94 indicating status

F-1 Student

I-94 Departure Card AND

Form I-20 - Certificate of Eligibility (F-1 Status) AND

Copy of US VISA **

*** If student is on OPT (Optional Practical Training) also attach a valid

Employment Authorization Card indicating “Practical Training”

J-1 Student

I-94 Departure Card AND

DS-2019 - Certificate of Eligibility (J-1 Status) AND

Copy of US VISA **

J-1 Non-student

(professor, teacher, or

researcher)

I-94 Departure Card AND

DS-2019 - Certificate of Eligibility (J-1 Status) AND

Copy of US VISA **

J-2 Spouse

*Not eligible for Tax

Treaty

I-94 Departure Card AND

Copy of US VISA** AND

Valid Employment Authorization Card

H-1B Worker

I-94 Departure Card AND

I-797 AND

Copy of US VISA **

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Reminders

 Non Resident Aliens are responsible for ensuring that that they

maintain their VISA and if applicable, work authorization current.

 Maintain legal status at all times.

 Notify the Department Payroll Representative regarding VISA

changes, change of address, tax status, etc.

 Notify the Department of International Education regarding VISA

changes.

 Every November it is required that all NRA’s complete a Citizenship

Status Form (CSF and accompanying tax documents). Completed

forms are given to the Department Payroll Representative.

CLASSIFICATION

REQUIRED ATTACHMENTS MUST BE SUBMITTED WITH THE

PAYROLL DOCUMENTS AND CITIZENSHIP STATUS FORM

G-4 Dependent of G-1

(Employee of Int’l

Organization)

I-94 Departure Card AND

Copy of US VISA** AND

Valid Employment Authorization Card

O-1

I-94 Departure Card AND

Copy of US VISA

I-94 Departure Card AND

I-797 AND

Copy of US VISA

Pending Immigrants

(PP)

I-94 Departure Card and

Valid Employment Authorization Card AND

Copy of US VISA