Emory Report

February 2, 1998

 Volume 50, No. 19

Some facts about international visitors and U.S. tax law

Emory's strategy for enhanced internationalization encourages us to invite more international scholars to campus. These scholars will enrich our intellectual inquiry and broaden our world view. When they return home, their continued contacts with our faculty and students will link Emory to their work and institutions.

There are some U.S. laws and regulations that may challenge our efforts to facilitate visits by international scholars:

  • A number of countries do not have reciprocal tax treaties with the United States that exempt income from taxation. The Internal Revenue Service (IRS) requires scholars from those countries to pay taxes on payments they receive from Emory or other U.S. educational institutions. Emory withholds the tax requirement at the time of payment. To pay a visiting scholar, the host department or unit must budget 143 percent of the fee to cover both the payment and tax.
  • The IRS also requires international scholars to obtain an Individual Tax Identification Number (ITIN) or Social Security number, which must be provided to Emory before any payment is made. The scholar can obtain the ITIN before departing for or after arriving in Atlanta, but, in either case, the process may be time-consuming.
  • The Immigration and Naturalization Service permits compensation only to certain visa holders. In order to be paid honoraria, visitors from countries other than Canada must travel on a J-1 visa, which takes two or three months to obtain from a U.S. consulate or embassy. Canadians may enter on a J-1 visa or Trade NAFTA (TN) immigration status. For reimbursement of expenses or a reasonable per diem only, visitors need a business visitor (B-1) visa or a waiver for business (WB) immigration status. No payment of any type can be provided to a person traveling on a visitor (B-2) or waiver for tourism (WT) immigration status.

A failure by Emory and other U.S. educational institutions to comply with these regulations would be a violation of law, subject to substantial financial penalties. We are consulting with other schools about lobbying for the legal exemption of educational institutions from some of these requirements. In the meantime, we must understand the requirements and comply with them.

A task force has been created by the offices of the Treasurer, International Student and Scholar Programs, Governmental Affairs, International Affairs, and the International Affairs Council to communicate clearly the tax and visa requirements for international visitors and to ensure Emory's compliance requirements are no more onerous than necessary.

Over the past few months, task force members have talked to counterparts at other institutions, virtually all of whom now the laws as Emory does. Many have become more rigorous in their compliance efforts within the past six months since, until recently, the IRS did not require the ITIN or enforce the tax provision on payments for international scholars.

Some Emory faculty members have been told by colleagues elsewhere or by foreign scholars that other schools are less rigorous than Emory in applying the law. These people may not be aware of current policies of the schools in question. However, if you receive information about other schools whose compliance policies or procedures vary from those Emory has adopted, please write to <oia@emory.edu>. Our task force will pursue the matter with appropriate officials in those schools.

The task force has developed detailed reference materials to assist you. Information posted on the web at <http://www.cc.emory.edu/OIA/oia_news.html> includes an expanded paper on tax and visa issues, essential tax and visa requirements, a process checklist, Emory and Atlanta-area resources, a list of countries with which the U.S. has reciprocal tax treaties and a visa type-tax status matrix.

-Marion Creekmore

Marion Creekmore is vice provost for international affairs.

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