Payments to Nonresident Aliens: New Procedures

NYU Steinhardt News

Payments to Nonresident Aliens: New Procedures

New procedures effective September 1, 2011.

The Internal Revenue Service (the “IRS”) requires that New York University (the“University”) follow specific federal tax withholding and reporting regulations in connection with all payments made to nonresident aliens (a tax term used by the IRS for individuals visiting the United States from abroad).

To enable the University to more efficiently and securely comply with the IRS's requirements, the University is implementing an online tax compliance system (“GLACIER”).

GLACIER facilitates information collection and review procedures for payments to nonresident aliens and replaces the paper-based, in-person interview processes.

Affected transactions include, but are not limited to, all payments to foreign nationals and foreign  entities for compensation and wages for:

  • services
  • honoraria
  • consulting fees
  • scholarships
  • fellowships
  • stipends
  • royalties
  • commissions
  • some reimbursements for travel and other expenses

The new procedures impact all new payees and are in effect as of September 1, 2011.

A Steinhardt guideline, Payments processed by Accounts Payable to Independent Contractors, Guest Speakers, Consultants, Royalties, Vendors Providing Services, Etc., provides information on the simple steps to be taken to comply with the new procedures for payments made via Accounts Payable. Key issues are timeliness and the use of newly revised AP payment forms. 

This change should :

  • simplify processing these requests by NYU and the payee’s completing tax compliance steps
  • expedite the nonresident alien’s receiving payments

Please watch out for further information about other types of payments to nonresident aliens and updates about GLACIER.