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Scholarship for nonresident alien student
May 17, 2023
Q. I was told if we are paying a nonresident alien student a scholarship/fellowship and they cannot be contacted to obtain the required documentation, the default tax rate is 14%, not 30%. What if they are resident alien for tax purposes? Do we just withhold 14% tax from them and give them a 1042-S instead of a paying in full and issuing a 1099?
A.
(Answered by IOFM's third-party tax experts)
An individual who is a resident alien for tax purposes (a person who has reached that status because of…
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