Non Resident Alien Status for Federal Income Tax Withholdings

Internal Revenue Service Publication 15-T mandates that the amount of federal income tax to withhold from the wages of nonresident alien employees performing services within the United States is adjusted for the IRS regulations.  This procedure only applies to nonresident alien employees who have wages subject to income tax withholding.  

The amounts set forth by the Internal Revenue Service are added to applied wages solely for calculating income tax withholding on the wages of the nonresident alien employee. The amounts shouldn't be included in any box on the employee's Form W-2 and don't increase the income tax liability of the employee. Also, the amounts don't increase the social security tax or Medicare tax liability of the employer or the employee, or the FUTA tax liability of the employer.

Completing and Submitting a W4

If the employee is a nonresident alien, the employee must check the box on the W4. 

The Employees Payroll Summary Record

If the employee is a nonresident alien, the box noted below should be checked off:

How the calculations are displayed in the deduction audit

If the Nonresident alien box is checked, when payroll is calculated and the Federal Income Tax withholds are calculated, the wages will be adjusted by the amount mandated by the Internal Revenue Service.  The following is a sample of the Federal income Tax deduction audit when the box is checked: