Department personnel, who propose to employ a Nonresident Alien, must determine if the NRA has a U.S. Social Security Number and a visa type that permits employment. NRA employees must have a U.S. Social Security Number before their tax documents can be filed with the IRS and their employment data entered into the UNCP (HRS) payroll system. If the NRA does not have a U.S. Social Security Number, he/she should go to the local Social Security Office and complete a Form SS-5 (Application for a Social Security Card). It will be necessary to have documentation to indicate that they will be employed at the university. This is usually in the form of a letter from the employing department. Before going to the Social Security Office, it is suggested that the International Programs Office be contacted to assist with questions and proper documentation.
When Nonresident Aliens are approved for employment, the employee must schedule an appointment with Jacqueline Strickland, Payroll Officer, ext. 6284. The purpose of this meeting is to review the NRA's tax status and to finalize the completion of required tax documents.
Since most of the tax documents are completed and filed for a specific calendar year, all NRA employees are requested to schedule an appointment with the Accounting Technician each year, in December. The purpose for this meeting is to review any changes in the tax status of the employee and to complete tax forms necessary for the new calendar year.
NRA employees are subject to Social Security Tax (FICA TAX). However, they may be exempted from this tax for a specific time period depending upon the visa type they have used to enter the United States. The status of this FICA Tax exemption will be determined during the first appointment with the Accounting Technician and during the meeting each year in December.
Wages paid to foreign employees are subject to Federal and State Income Tax unless exempted by special IRS regulations or a tax treaty between the United States and the specific resident country of
the employee. When the NRA meets with the Accounting Technician at the time of employment or in December each year, an analysis will be made to determine his/her tax status and to see if any tax treaty benefits are applicable. At that time, required tax forms and documents will be completed, signed, and filed with the appropriate tax offices.
The NRA should bring the following documents to the scheduled appointment with the Accounting Technician:
- US Social Security Card
- I-94 (Departure Record)
- I-20 (Certificate of Eligibility for Nonimmigrant (F-1) Student), or IAP-66 (Certificate of Eligibility for Exchange Visitor (J-1) Status)
- Letter of appointment from the department or Graduate School
After the end of the calendar year, the Payroll Department will issue a Form W-2 (Wage and Tax Statement), if applicable, and/or a Form 1042-S (Foreign Person's U.S. Source Income Subject to Withholding) to the NRA which will report the amount of compensation paid and taxes withheld.
Note: If the NRA is from a country that does not have a tax treaty with the United States, compensation will be subject to the graduated withholding rates and the tax calculated based on his/her Form W-4 and Form NC-4. UNCP will send this withheld tax to the IRS and the North Carolina Department of Revenue. The NRA should complete a Form 1040-NR (U.S. Nonresident Alien Income Tax Return) and a NC Form D-400 (Individual Income Tax Return) at year-end. The Form 1040-NR and Form D-400 will determine if the NRA owes additional tax or is entitled to a refund of previously withheld tax. Contact Jacqueline Strickland, 910.521.6284, for questions concerning U.S. Tax treaties or the forms mentioned above.