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previous page Previous Page: Publication 15-T - New Wage Withholding and Advanced Earned Income Credit Payment Tables (for wages paid through December 2009) - Notice to Employers
next page Next Page: Publication 15-T - New Wage Withholding and Advanced Earned Income Credit Payment Tables (for wages paid through December 2009) - Increased Exclusion Amount for Combined Commuter Highway Vehicle Transportation and Transit Passes
 Use previous pagenext page to find additional occurrences of topic items.Index for this Publication
taxmap/pubs/p15t-002.htm#en_us_publink1000145960

Withholding Income Taxes on the Wages of Nonresident Alien Employees(p2)


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Withholding Income Taxes on the Wages of Nonresident Alien Employees

In general, you must withhold federal income taxes on the wages of nonresident alien employees. However, see Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities, for exceptions to this general rule. You must add an amount as set forth in the chart below to the nonresident alien's wages solely for calculating the income tax withholding for each payroll period. You determine the amount to be withheld by applying the income tax withholding tables to the amount of wages paid plus the additional chart amount. For more information, see Notice 2005-76, 2005-46 I.R.B. 947, available at  
www.irs.gov/irb/2005-46_IRB/ar10.html.
As the new withholding tables were developed due to changes to the tax law made by the American Recovery and Reinvestment Act of 2009, the amount to add to a nonresident alien employee's wages for calculating income tax withholding only has been increased. See the chart below for these increased amounts.
Deposit
Nonresident alien students from India and business apprentices from India are not subject to this procedure.
The amount to be added to the nonresident alien's wages to calculate income tax withholding is set forth in the following chart.

Amount to Add to Nonresident Alien Employee's Wages for Calculating Income Tax Withholding Only

Payroll PeriodAdd Additional 
Weekly$  138.00 
Biweekly276.00 
Semimonthly299.00 
Monthly598.00 
Quarterly1,795.00 
Semiannually3,590.00 
Annually7,180.00 
Daily or Miscellaneous
(each day of the payroll period)
27.60 
The amounts added under this chart are added to wages solely for calculating income tax withholding on the wages of the nonresident alien employee. These chart amounts should not be included in any box on the employee's Form W-2, Wage and Tax Statement, and do not increase the income tax liability of the employee. Also, these chart amounts do not increase the social security, Medicare, or Federal Unemployment Tax Act (FUTA) tax liability of the employer or the employee.
This procedure only applies to nonresident alien employees who have wages subject to income tax withholding.
Note.The following example will deal with the new withholding tables only. For withholding on wages to nonresident alien employees before the new withholding tables were implemented (after February 17, 2009, but not later than April 1, 2009), see Withholding income taxes on wages of nonresident alien employees in section 9 of Publication 15 (Circular E).
taxmap/pubs/p15t-002.htm#en_us_publink1000145973

Example.(p2)

An employer using the percentage method of withholding pays wages of $500 for a biweekly payroll period to a married nonresident alien employee. The nonresident alien has properly completed Form W-4, entering marital status as "single" with one withholding allowance and indicating status as a nonresident alien on line 6 of Form W-4 (see page 71). The employer determines the wages to be used in the withholding tables by adding to the $500 amount of wages paid the amount of $276 from the chart above ($776 total). The employer then applies the applicable table (Table 2(a), the table for biweekly payroll period, single persons) by subtracting the applicable percentage method amount for one withholding allowance for a biweekly payroll period from $776 and making the calculations according to the table.
The $276 added to wages for purposes of calculating income tax withholding is not reported on Form W-2, and does not increase the income tax liability of the employee. The $276 added amount also does not affect the social security tax, Medicare tax, or FUTA tax liability of the employer or the employee.
previous pagePrevious Page: Publication 15-T - New Wage Withholding and Advanced Earned Income Credit Payment Tables (for wages paid through December 2009) - Notice to Employers
next pageNext Page: Publication 15-T - New Wage Withholding and Advanced Earned Income Credit Payment Tables (for wages paid through December 2009) - Increased Exclusion Amount for Combined Commuter Highway Vehicle Transportation and Transit Passes
 Use previous pagenext page to find additional occurrences of topic items.Index for this Publication