Non-Payroll Payments to Foreign Nationals (FN)

General Information

As part of vendor set-up in Banner, the UNM Purchasing Department will require a signed Federal Form W-8 BEN from all Foreign National (FN) vendors.  This applies to both foreign individuals and corporations.  You can obtain this form at  IRS website: http://www.irs.gov/pub/irs-pdf/fw8ben.pdf .

Payments to or on behalf of foreign visitors require a more stringent documentation and review process. UNM Taxation Department (Taxation) must approve all non-payroll payments to these FN vendors as well as payments to foreign students.  Some payments are prohibited to FNs with certain types of visas.  A Social Security Number (SSN)*** or an Individual Tax Identification Number (ITIN)*** may be required if the payment is found to be tax reportable.

It is not possible to list all the different facts and circumstances that might surround the invitation of a Foreign Visitor to UNM. You may want to review the IRS Publication 15 Withholding of Tax on Nonresident Aliens and Foreign Entities. We suggest that Departments please contact Taxation for further information.

If a PCard or Banner Requisition will be used to pay any portion of the travel expense, see special requirements and approval BEFORE making the purchase on a PCard or creating a Banner Requisition. This process requires a paper, special Requisition Form .

 

TYPES OF PAYMENTS:

• Dues and subscriptions
• Purchases of tangible goods
• Registration fees for conferences out side the U.S
• Services performed outside the U.S.

  Submit Direct Pay Approval Form (DP-EZ) to Taxation for approval. No visa documentation is required.

• Travel

  Payments for travel reimbursements to FNs visitors who are not UNM students or staff either made directly to the FN or to another on behalf of the FN require a copy of the I-94***, a copy of the Visa or a Visa Waiver statement (specifically the front page with picture/ information and the page with the visa stamp for this current visit), and a business purpose that demonstrates how the University benefits from this travel.  Submit this information along with the Direct Pay Approval Form (DP-EZ) to Taxation for approval.
  

• Note: I-94*** documentation must be obtained while the visitor is in the U.S. because it will be returned to the immigration inspector when the visitor leaves the country.  Persons without a Visa must submit a Visa Waiver statement that indicates they are traveling on a Visa Waiver and which country has provided the Waiver supported by a passport that show their country of origin.

• Royalties

  An FN receiving royalties must provide their email address and/or fax number in their country. Typically, these FNs never enter the U.S. Visa and I-94*** documentation are not required unless they enter the U.S. Typically, unless vendor has a US tax ID number and treaty benefits are available and claimed in writing, there will be a 30% withholding required.

• Honoraria

Payments for honoraria, require I-94*** documentation, a copy of the visa (or a visa waiver statement), and a business purpose that demonstrates how the University will benefit from this expense. If the foreign visitor has a B type visa, Honoraria are restricted to nine days and a signed B and VWB Attestation Form will also be required. This information should be submitted to Taxation for approval along with the Direct Pay Approval form. Federal Form 1042-S withholding of 30% may be required. See additional requirements below under Most Common Foreign Visitor Visa Types.

Form 1042-S Withholding

– Foreign Person's U.S. Source Income Subject to Withholding –: Reports the payments received and taxes withheld.  If tax has been withheld from royalties, honoraria, or other tax reportable payments, the FN will receive Form 1042-S by March 15th of the following year.  This form is also submitted to the Internal Revenue Service by the Taxation department for tax reporting purposes.

***SSN (Social Security Number)- The visitor can apply to the Social Security Administration for an SSN on Form SS-5. Please click here for more information. It takes about 2 weeks to issue the number after all required information has been received. A Canadian Social Insurance Number does not satisfy this requirement.


***ITIN (Individual Taxpayer Identification Number) - The visitor can apply to the IRS for an ITIN on Form W-7. Please click here for more information. It can take 6-8 weeks to issue the number after all required information has been received. A Canadian Social Insurance Number does not satisfy this requirement.


Note:  The Federal Application Forms SS-5 and W-7 should not be submitted to UNM.  The instructions to each of those forms contain information on where they should be submitted.

***I-94 Arrival-Departure Card – FN visitors receive this from the immigration inspector at the port of entry.  It records the immigrant classification and the authorized length of stay in the United States.  It is returned to the immigration inspector as the visitor leaves the U.S.

Most Common Foreign Visitor Visa Types

Visa type B or VWB (B type Visa):

This is a business visitor and is the most common way for a visitor to enter the country to give a presentation or lecture and then be paid honorarium. See Honorarium topic above. These foreign visitors are not allowed to be employed. They can be reimbursed for their living expenses per UBPP 4030- Travel, for the period of time allowed on their I-94(W), Record of Arrival-Departure. Documentation required if B Visa or VWB:

• FN's email address and fax number in his/her country
• SSN or ITIN may be required
• Copy of Visa (front page and visa stamp for this visit) or a visa waiver statement (supported by their Passport)
• Copy of I-94 or I-94W stamp in their passport
• B1 and VWB Attestation Form , signed
• Form W-8BEN, signed
• Form 8233, signed, if claiming treaty benefits, along with their US Federal Individual Taxpayer Identification Number (ITIN) -required for claiming treaty benefits

  Visa type J1:

  This is an exchange student, researcher, or teacher. All J1's have a Form DS-2019, (formerly IAP-66), Certificate of Eligibility for Exchange Visitor, issued by the institution sponsoring the visit in the U.S. J1's sponsored by UNM may be employed by UNM. If UNM is not listed as the "sponsor", then we will need a written approval from the sponsoring entity to pay the FN for services/honoraria. Please include this approval from their sponsor with your request for payment or provide the sponsoring organization contact information to Taxation and we will request this approval. Reimbursement for living expenses for a J-1 whose stay exceeds one year may require 14% withholding. Documentation required if J1 Visa:

• FN's email address and fax number in his/her country
• SSN or ITIN may be required
• Copy of Visa (front page and visa stamp for this visit) or a visa waiver statement (supported by their Passport)
• Copy of I-94
• Copy of Form DS-2019 (formerly IAP-66), that indicates the sponsoring institution
• Letter from sponsoring institution authorizing payment (only if non UNM sponsor)
• Form W-8BEN, signed
• Form 8233, signed, if claiming treaty benefits

  Note: Other visa types than B or J-1 may not allow for an honorarium payment. Please contact Taxation for further instructions or questions.