SCHOLARSHIPFELLOWSHIP PAYMENTS TO NONRESIDENT ALIENS STATE AND UBF FUNDED

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SCHOLARSHIP/FELLOWSHIP PAYMENTS TO NONRESIDENT
ALIENS STATE AND UBF FUNDED
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NONRESIDENT ALIEN

• This term is used for Tax purposes not
  Immigration
• As a general rule F-1 and J-1 students who have
  been in the U.S. 5 calendar years or less.
• J-1 non-students who have been in the U.S. no
  more than 2 out of the last 6 years.

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DEFINITIONS

• Types of Payments
• Scholarship/Fellowship Amount given to an
  individual to aid in study, training, or research
  and which does not require work to be performed
  to receive the money.
• Prizes and Awards Amount received primarily in
  recognition of religious, charitable, scientific,
  educational, artistic, literary, or civic
  achievement or received as the result of entering
  a contest.

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DEFINITIONS

• Qualified Expenses Tuition, comprehensive fees,
  student activity fees, and direct billed course
  and program fees.
• Required books, supplies, and equipment
  Qualified expenses for student athletes, EMBA,
  PMBA, and dental school students .
• No tax withholding or reporting for qualified
  expenses as long as payments are not made
  directly to the individual.

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DEFINITIONS

• Nonqualified Expenses Room and board, travel
  and any payments made above and beyond the cost
  of the qualified expenses. This includes state
  fellowships paid directly to the student.
• Subject to federal tax withholding of 14, unless
  there is an applicable tax treaty exemption.

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INTRODUCTION

• IRS regulations state that nonqualified
  scholarship payments to nonresident aliens must
  be taxed.
• The tax rate is 14 for students on F-1 and J-1
  visas.
• Nonresident aliens should be issued a 1042-S
  statement at year end.
• The 1042-S is a statement issued to nonresident
  aliens which reports various income and tax
  withholdings.

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CURRENTLY

• State funded- no tax withholding or reporting
• Payments are paid from various areas (e.g.
  Accounts Payable, Financial Services, UBF, etc).
• Qualified and nonqualified expenses are treated
  the same.

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NONRESIDENT ALIEN SCHOLARSHIP/FELLOWSHIP VOUCHER

• SEPARATE instructions for completing and MAILING
  forms
• Scholarship/Fellowship Voucher
• Request for Information
• Voucher for State and UBF scholarships can be
  found at the SRC office website
  http//src.buffalo.edu/office/officeforms/generalf
  orms.shtml
• or on the UBBusiness website
• www.ubbusiness.buffalo.edu
• under Administrator gt Payments gt State
  Scholarship Voucher
• Information regarding State fellowships can also
  be found at the Financial Services website
  http//ubbusiness.buffalo.edu/ubb/cfm/policies/
• or on the UBBusiness website www.ubbusiness.buff
  alo.edu
• under Administrator gt Payments gt State
  Fellowship Voucher

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INSTRUCTIONS FOR COMPLETING FORMS

• Forms should be used for scholarships/fellowships
  paid with State or UBF funds to nonresident
  aliens.
• Research Foundation will continue to follow their
  current procedures.
• Both the voucher and request for information must
  be completed.
• State fellowship forms ONLY should be sent
  directly to Amanda Maines at 120 Crofts Hall.
• All other vouchers should be sent directly to
  Student Academic Records and Financial Services
  (SARFS).
• Refunds will be issued by SARFS, the student must
  complete the Request for Refund Form found at
  the SRC student website http//src.buffalo.edu/pd
  f/requestforrefund.pdf.

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NONRESIDENT ALIEN SCHOLARSHIP/FELLOWSHIP VOUCHER
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NONRESIDENT ALIEN SCHOLARSHIP/FELLOWSHIP VOUCHER
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REQUEST FOR INFORMATION
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REQUEST FOR INFORMATION
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REQUEST FOR INFORMATION
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TAX TREATIES

• There are 41 countries that have tax treaties for
  scholarship income.
• Treaty eligibility (W-8BEN)
• SSN or ITIN (Individual Taxpayer Identification
  Number)

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ITIN

• Applying for an ITIN
• Social security numbers are only issued for
  employment.
• No ITIN 14 tax
• Treaty Eligible SSN/ITIN 0 tax

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STATE FELLOWSHIP PROCEDURE

• Complete voucher for state nonresident alien
  fellowships. Process all others through
  fellowship application.
• All State fellowship payments will be made
  biweekly.
• Additional information required
• Begin and end check date
• Check sort code
• Forward completed voucher and request for
  information to Amanda Maines, 120 Crofts Hall.
• Please see the following website for more
  information http//ubbusiness.buffalo.edu/ubb/cfm/
  policies/

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SCHOLARSHIP PROCEDURE

• Department completes -Scholarship/ Fellowship
  Voucher
• Student completes - Request for Information and
  must sign the student certification on the
  voucher
• All vouchers will be sent to Student Academic
  Records and Financial Services (SARFS).
• If the form is sent to Financial Services or UBF
  first it will be forwarded to SARFS and further
  delay the processing.

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SCHOLARSHIP PROCEDURE

• SARFS will determine the qualified and
  nonqualified amounts based on the students
  account.
• The voucher and request for information will then
  be sent to either UBF or the State payroll
  department.

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STATE SCHOLARSHIP PROCEDURE

• SARFS State Payroll/Financial Services
• Qualified Amount
• Financial Services SARFS
• Nonqualified Amount Net Taxes
• State Payroll SARFS
• Students with a credit balance on their account
  can complete a Request for Refund Form, which
  can be found at http//src.buffalo.edu/pdf/request
  forrefund.pdf

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UBF SCHOLARSHIP PROCEDURES

• SARFS UBF
• Qualified Amount
• UBF SARFS
• Nonqualified Amount Net Taxes
• UBF SARFS
• Students with a credit balance on their account
  can complete a Request for Refund Form, which
  can be found at http//src.buffalo.edu/pdf/request
  forrefund.pdf

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RF PROCEDURES

• The process for utilizing RF funds for payments
  to nonresident aliens has not changed.
• The RF does not pay students directly.
• All payments for tuition remission are remitted
  directly to SARFS.
• Tuition remission is requested by completing and
  submitting a Grant Billing Form.
• Salary and fellowship payments are processed
  through the payroll mechanism and are therefore
  taxed accordingly.

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TIPS

• IRS Publication No. 515, Withholding of tax on
  Nonresident Aliens and Foreign Entities at
  http//www.irs.gov/pub/irs-pdf/p515.pdf
• State processing may take 4-6 weeks to complete
  from the start of the semester due to the State
  payroll cycle
• Multiple awards- First come, first serve
• Notification of changes to students registration
  after the award has been processed should be done
  immediately

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TIPS

• Receipts
• Income Tax Return
• ISSS website http//wings.buffalo.edu/intlservices
  /index.html

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CONTACTS
Foreign National Tax Unit SARFS Amanda
Maines Kellie Kostek amaines_at_business.buffalo.e
du kkostek_at_buffalo.edu 645-5000 ext.
1286 645-5683 UBF Financial
Services Elaine Schaffer Carrie
Grimshaw eschaffe_at_buffalo.edu cgrimshaw_at_business
.buffalo.edu 645-3013 645-5000 ext. 1338
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QUESTIONS?
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THANK YOU!