For the Language School we sometimes have Directors who are non-U.S. citizens who are not legal permanent residents and during the academic year live in a foreign country while they receive a yearlong stipend from Middlebury College.
For those directors (in the current case only Aline Germain-Rutherford) they need to be set up the following:
- The academic year BW should be set up FED, SVT, FSS, FME exempt, VUI OS active; their earnings will not be taxed as it is considered ‘foreign source’, i.e., the work is not done on U.S. soil;
- During Language School when they are actually here and paid through LS they should be set up based on their visa status and the Windstar analysis. For Aline the set up has been FED, FSS, FME, SVT exempt and FFC, SVC, VUI VI active;
- At year end the Tax Manager together with Payroll has to ensure that no W-2 is issued for the earnings in BW, but a W-2 or 1042-S depending on the tax status of the director for the LS payments;
- The LS budget coordinator needs to alert HR and the Tax Manager in case a new Director comes in with these characteristics, so that the person can be set up correctly in Banner and can be added to the year-end W-2 audit list.
This has been implemented for Summer 2007.
Status: February 19, 2009