Nonresident Alien Expenditure Object Codes

John P. Kruczek, University Controller

The Office of the State Comptroller has advised us that effective immediately, new object codes will be used to process certain payments to nonresident aliens. The new object codes for the University of Florida are:

135001 – Independent Contractor – NRA – Taxable

Independent contractor services performed by nonresident aliens that are subject to tax reporting on Form 1042S and federal income tax withholding. Note: Use object code 135101 if the payment is exempt from federal income tax withholding under a tax treaty or 135201 if the payment qualifies as foreign source income.

135101 – Independent Contractor – NRA – Tax exempt by treaty

Independent contractor services performed by nonresident aliens that are subject to tax reporting on Form 1042S, but are exempt from federal income tax withholding under a tax treaty.

135201 – Independent Contractor – NRA – Foreign source

Independent contractor services performed by nonresident aliens that are not subject to tax reporting or federal income tax withholding because the payment qualifies as foreign source income. Note: For foreign source payments only, when payee does not have a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN), a temporary number may be issued by University Purchasing.

267001 – Travel, Nonresident Alien Only – Taxable

Travel reimbursements to, or travel payments on behalf of, nonresident aliens that are subject to tax reporting on Form 1042S and federal income tax withholding. Note: Use object code 267101 if the payment is exempt from federal income tax withholding under a tax treaty or 267201 if the payment qualifies as foreign source income.

267101 – Travel, Nonresident Alien Only – Tax exempt by treaty

Travel reimbursements to, or travel payments on behalf of, nonresident aliens that are subject to tax reporting on Form 1042S, but are exempt from federal income tax withholding under a tax treaty.

267201 – Travel – Foreign Source

Foreign travel for non-resident aliens that qualifies as foreign source; tax reporting is not required and the payment is not subject to federal income tax withholding. Note: For foreign source payments only, when payee does not have a SSN or an ITIN, a temporary number may be issued through University Purchasing.

Please be reminded that payments of travel expenses to nonresident aliens who are not University employees are subject to IRS withholding and reporting requirements. Although the IRS routinely applies the accountable plan rules to travel expenses for U.S. citizen and U.S. resident alien independent contractors, the IRS has taken the position that the accountable plan rules do not apply to payments made to or on behalf of nonresident aliens, including independent contractors.

Training classes regarding these changes and other changes affecting payments to nonresident aliens are scheduled for January 21, 1:30 – 3:00 p.m. and January 22, 9:00 – 12: 00 a.m., Room 346-347 at the J. Wayne Reitz Union. To register for these classes, please contact Cheryl Goodson at 392-1321 or email at chgoods@nervm.nerdc.ufl.edu.

If you have any questions regarding this information, please call Murphy Miller at 392-1231 or email at mmiller@nervm.nerdc.ufl.edu.