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Foreign Nationals Working in the US

The following information and resources are for Foreign Nationals working inside the US. If you are a U.S. citizens or resident aliens (includes Lawful Permanent Residents) working outside the US, visit the Employees Working Outside the US page on the payroll website to review the information and resources that fit this role.

Foreign national employees who receive predoctoral fellowships, training grants, or post doctoral scholar payments should review this additional taxation information which provides foreign national taxation information that is specific to those types of payments.

Taxes by Tax Residency

Federal Income Tax (FIT)

For federal tax purposes, nonimmigrants are classified as resident aliens and nonresident aliens and are taxed at different graduated rates. Tax residency for federal tax purposes is determined by either the Substantial Presence Test or the Green Card Test. For information on determining your federal tax residency status, see Internal Revenue Service Publication 519, Chapter 1.

Tax treaties make it possible to reduce or eliminate federal income tax withholding on payments to non-immigrants. Eligibility requirements include tax residence status, prior visits to the U.S., and type of payment. Information provided on the Foreign National Information Form at the time of hire will be analyzed by the Payroll Department. If it is determined the employee is eligible for the treaty benefit, it will be applied to the employee’s pay in the manner specified in the treaty. To see if your country of tax residence has a tax treaty with the U.S., refer to the IRS tax treaty table in IRS Publication 901.

Postdoctoral Scholar and Predoctoral Fellows & Training Grant Recipients have specific tax information relative to these roles. You can review the federal and state information including additional payment details for scholars. 

Federal Insurance Contributions Act Tax (FICA)

Faculty, Staff, and Postdoctoral & Research Associate Employee:

Most employees in the United States pay social security and Medicare (FICA) taxes on wages received for services performed as an employee in the United States. These taxes contribute to the United States’ social security system, which provides retirement and medical insurance benefits to certain individuals. The current combined rate for employees is 7.65%. In most cases, employers deduct these taxes from each paycheck. The employer also pays 7.65% into the social security system on the employee’s behalf.

FICA is generally not withheld from nonresident aliens in F-1 and J-1 visa status whose services carry out the purpose for which they were admitted to the United States. These types of services are very limited, and generally include only on-campus work, practical training, and economic hardship employment. (IRS Publication 519, Chapter 8, page 43) The University of Pittsburgh begins withholding FICA from the first pay of the calendar year in which the employee is expected to become a resident alien, by passing either the Substantial Presence Test (SPT) or the Green Card Test.

Student Employees and Graduate Students with Academic Appointments:

Most employees in the United States pay social security and Medicare (FICA) taxes on wages received for services performed as an employee in the United States. The current combined rate is 7.65%. These taxes contribute to the United States’ social security system, which provides retirement and medical insurance benefits to certain individuals. In most cases, employers deduct these taxes from each paycheck.

There are two reasons for exemption from FICA withholding:

Nonresident Status – Non-immigrants in F-1 and J-1 status who are nonresidents for tax purposes are exempt from FICA until they become resident aliens (US tax residents) by passing either the Substantial Presence Test (SPT) or the Green Card Test. Upon advice from the Internal Revenue Service, the University of Pittsburgh begins withholding FICA from the first pay of the calendar year in which the employee is expected to become a resident alien. Student Credit Load – F-1 and J-1 Students are exempt from FICA as long as they are registered in courses with a combined credit load as shown in the following chart.

 

Term Undergraduate Credit Load Graduate Credit Load
  Part Time Full Time Part Time Full Time
Fall/Spring Terms 6+ 12+ 4.5+ 9+
Summer Term 3+ 3+ 3+ 3+

Graduate Students working on dissertations must be registered as graduate student and PeopleSoft must be coded as dissertation student for the FICA exemption to be applied.

Please note: Students must be registered for classes appropriately prior by payroll processing established deadlines in order to be eligible for the FICA tax exemption benefit.

For more information, please review IRS page regarding Social Security and Medicare taxes.

State Income Tax (SIT)

For Pennsylvania state tax purposes, individuals in general are classified as residents and nonresidents. Tax withholding is the same for both residency statuses, as Pennsylvania does not have a nonresident tax withholding rate. For information on determining your Pennsylvania residency status, see the PA Department of Revenue website.

The state of Pennsylvania does not recognize tax treaty benefits for state income tax purposes.

Postdoctoral Scholar and Predoctoral Fellows & Training Grant Recipients have specific tax information relative to these roles. You can review the federal and state information including additional payment details for scholars. 

Local Earned Income Tax (EIT)

For Local Income Tax purposes, individuals working on visas are considered nonresidents. Nonresidents are subject to the nonresident local income tax rate of the municipality in which they work.  If they apply for United States Permanent Residency they will be classified as a resident of the municipality where they reside. This change of residency status changes their local income tax obligation to where they live and they become subject to the school tax of their local school district.

  • Example 1
    • Jane is a Research Associate on a J-1 nonstudent visa who was hired on September 1st to work at the Pittsburgh Campus of the University of Pittsburgh. Jane lives in Mt. Lebanon but her local income tax obligation is to the City of Pittsburgh (where she works). On December 1st, Jane applies for U.S. Permanent Residency. Her local tax obligation moves to Mt. Lebanon where she begins paying the resident rate and Mt. Lebanon school tax.
  • Example 2
    • Philip is a Computer Programmer on an H-1B visa who was also hired on September 1st to work at the Pittsburgh Campus. Philip lives in the City of Pittsburgh. On December 1st, Philip applies for U.S. Permanent Residency. His local tax obligation stays with the City, but he begins paying the resident rate and City of Pittsburgh school tax.

For more information on local tax withholding, visit the Jordan Tax Service website.

Local Services Tax (Occupational Tax)

Local Services Tax is withheld from each working individual in Pennsylvania, regardless of residency status. Local Services Tax is paid to the Municipality of the taxpayer’s primary employer. Exemptions from Local Services Tax for non-immigrants include working for multiple employers and annual income under $12,000. Review the instructions on how to submit a Local Services Tax exemption through employee self-service in Pitt Worx.

State Unemployment Insurance Tax (SUI)

For Faculty, Staff, and Postdoctoral & Research Associate Employee in Pennsylvania, State Unemployment Insurance is withheld regardless of tax residency status. For more information on PA State Unemployment Insurance visit the Pennsylvania Department of Labor website.

Social Security Numbers

Non US citizens who have employment authorization qualify for a US Social Security Number (SSN). Individuals who work must have one for wage and tax reporting purposes.

Apply in person.

Non-immigrants may apply for a Social Security Number (SSN) in person at a Social Security Office.

EAST LIBERTY
6117 Station Street
Pittsburgh, PA 15206

DOWNTOWN PITTSBURGH
700 Grant Street Suite 1204
Pittsburgh, PA 15219

MOUNT LEBANON
650 Washington Road #120
Mt. Lebanon, PA 15228

Bring unexpired identification and current employment work authorization.

Identification Examples: Passport, foreign birth certificate
Work Authorization Examples: Forms I-551, I-766, I-94, DS-2019, I-20, EAD

See Social Security Numbers for Noncitizens

Tax Treaty Benefits

Tax treaty analysis and the extension of tax treaty benefits is a service the University of Pittsburgh offers to eligible resident alien and nonresident alien payees. Learn more about tax treaty benefits including eligibility requirements, processes, and helpful tips.

The state of Pennsylvania does not recognize tax treaty benefits for state income tax purposes.

Year End Information

Resident and nonresident aliens may receive Form W-2, Form 1042-S, or both depending on the type of income they have received, whether they have received a tax treaty benefit, and their tax residency status.

Payment Federal Tax Status Resident Alien Non-Resident Alien
Wages

Treaty Exempt

Not Treaty Exempt

Form 1042-S & Form W-2

Form W-2

Form  1042-S & Form W-2

Form W-2
Individuals receiving postdoctoral fellowships, predoctoral fellowships and training grants

Treaty Exempt

Not Treaty Exempt

No form issued

No form issued

Form 1042-S

Form 1042-S
  • Forms W-2 are mailed by January 31.
  • Forms 1042-S are mailed by March 15.
  • Please allow up to two weeks for delivery for all tax forms.

Requests to access current year Forms 1042-S are accepted and processed as early as two weeks after their scheduled mailing date. Forms 1042-S for up to three years prior can be requested at any time. Submit an inquiry to begin the process.

Please see our year end page for additional information regarding Forms W-2 access.

Frequently Asked Questions

Tax Residency

How can I determine my tax residency?

How does my tax residency affect my tax withholding?

  • Tax residency status affects federal and local income tax withholding. It is also one of the factors used in determining whether FICA (social security and Medicare) will be withheld. Certain taxes are withheld regardless of tax residency status.
Tax Treaty 

What are the criteria for receiving a tax treaty benefit?

  • When a treaty exists between the U.S. and the employee’s country of tax residence, it must contain an article for the type of income being paid. If these initial requirements are met, then the specifics of the employee are considered. These include tax residency status, prior U.S. visits (visa status, primary purpose and length of stay), and current visit details. Payroll tax treaty benefits are granted only to foreign nationals that possess a valid US Social Security Number (SSN).

How do I apply for a tax treaty benefit?

  • The information provided by the employee on the Foreign National Information Form (FNIF) at the time of hire is used to determine tax treaty eligibility for those who indicate on their FNIF that they would like to accept tax treaty benefits. Since the form is also used to determine tax residency status, it is required for all employees, not just those applying for a treaty benefit.

How will I know if I am eligible for a tax treaty benefit?

  • If you are eligible to receive a tax treaty benefit, notification will be sent to your Pitt email account. You will be given instructions for accessing and signing your treaty acceptance paperwork. A one month grace period is extended to all new tax treaty benefit recipients. To continue the treaty beyond that grace period, your signature is required.

Why do I not have a treaty?

  • There are multiple reasons why a treaty benefit might not be extended:
    • The US does not have a treaty with the employee’s country of tax residence.
    • The treaty does not apply to the employee’s type of income.
    • The US has a treaty with the employee’s country of tax residence and it applies to the type of income, but the employee:
      • does not qualify for some reason, ex. US immigration history.
      • does not have a US Social Security number.
      • did not sign the treaty acceptance paperwork prior to the assigned deadline.
      • declined to accept treaty benefits on the Foreign National Information Form.
      • has already reached the maximum annual benefit amount.

 

I have a treaty benefit. So, why are taxes withheld from my pay?

  • The state of Pennsylvania does not recognize tax treaty benefits, which means that tax treaty benefits apply to federal income tax only. Depending on your tax residency status and job title, you may be subject to other tax withholding. These taxes include social security and Medicare (FICA), state and local income, local services tax, and state unemployment.

Will I get the tax treaty benefit next year?

  • Tax treaty eligibility is determined each December for the following tax (calendar) year. If you qualify for the treaty benefit, Payroll will notify you that your new acceptance paperwork is available for your signature. Contact your department by January 15th if you believe you are treaty eligible and have not been notified to sign your documents.

 

Visa

Does my visa type affect my taxation?

  • Current visa status, along with the details of any prior visits to the U.S. you may have had, is used in determining your tax residency status. Tax residency status is one of the major criteria for potential receipt of tax treaty benefits. Generally, nonresident aliens in F-1 and J-1 visa class are exempt from social security and Medicare. F-1 and J-1 visa holders are also given a reduced tax withholding rate on their appointment-related scholarships and fellowships.

How do I update my visa information with the Payroll Department?

  • Notify your department administrator any time your visa information changes and reverify your I-9 information with Office of Human Resources (OHR). You can schedule an appointment through the OHR Form I-9 scheduling page. In the event that your new authorization has not been received before your current authorization expires, you may be asked to provide a copy of your receipt of application for extension and a letter from OIS confirming timely application has been made.
Year End 

Will I receive a year end tax document for tax filing purposes?

  • Anyone who has had federal, social security, Medicare, local or school taxes withheld will receive a Form W-2.
  • Anyone who has had tax treaty exempted income will receive a Form 1042-S.
  • Nonresident aliens for tax purposes who received postdoctoral scholarship, predoctoral fellowship, or training grant payments will receive a Form 1042-S.
  • It is possible to receive both tax forms.

Additional Resources