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General Tax Information U.S. Citizens & Green Card Holders

Visa Categories Non-Resident Alien vs. Resident Alien for Tax Purposes Social Security vs. Taxpayer Identification Number

Receiving Payments in the U.S.

Tax Forms from the College

Going Abroad Filing Your Tax Return Treaties, Forms & Publications Internal Procedures Contact Us

Royalties

... are processed through the individual departments in Middlebury / the Institute and paid via check or wire;

... are taxed by the College / Institute and the tax is subtracted from the independent contractors' check on behalf of the IRS. The tax rate is generally 30%. Depending on the last tax residence of the individual, a treaty benefit might apply dropping the tax rate to 0%. Because the flat tax rate of 30% is rather high, the IRS often gives you a tax refund once you file a tax return depending on your total income for the calendar year. 30% tax is applied to anybody who does not submit the Foreign National Information Form or the required documents;

... are reported by the College / Institute on Form 1042-S with income code 12, exemption code 00 if no treaty benefits have been applied, exemption code 04 if treaty benefits have been applied;

... are reported by you on Form 1040NR or 1040NR-EZ.
NOTE: For royalties to be taxable income in the U.S., the receiver of the payment does not have to be in the U.S., instead sourcing is based on where the right for which royalties are paid were used.

Fundraisers for Individuals

... include, but are not limited to, funds collected by students through a fundraiser to help a fellow student and possibly the family back home;

... can NOT be processed through College accounts;

... are NOT taxed by the College / Institute;

... are NOT reported by the College / Institute or anybody else on any tax form;

... are NOT reported by givee on Form 1040NR or 1040NR-EZ;

... are NOT reported by giver on Form 1040NR or 1040NR-EZ.

Note: All of the above is under the caveat that the gift is less than $12,000 (for 2008) (see Publication 950 for current limit).

Research Participant Payments

... are processed through the individual departments in Middlebury / the Institute and paid via check or gift certificate or cash;

... are taxed by the College / Institute and the tax is subtracted from the check, gift certificate, cash payment on behalf of the IRS. The tax rate is generally 30%;

... are reported by the College / Institute on Form 1042-S with income code 50, exemption code 00 as no treaty benefits have been applied;

... are reported by you on Form 1040NR or 1040NR-EZ.

Note: If research is done outside the U.S., payment is considered Foreign Source and hence not reported or taxed by the College / Institute. It still is reportable by you on your non-U.S. tax return.

Last Updated: October 12, 2009

Receiving Payments in the U.S.

Documents and IRS Forms needed to get Paid

Social Security and Medicare Tax Exemptions

Payments to Students and Fellows

Payments to Visitors

Payments to Employees

Other Types of Payments