Research Institutions

Research institutions count on Windstar Technologies to offer up-to-date comprehensive software products and services to meet IRS tax rules for nonresident aliens (NRA), including employees, interns, researchers, and other scholars.

Windstar® Solutions allow research institutions to:

• Provide proper tax and treaty benefits to employees, interns, researchers, and other scholars
• Avoid unnecessary assessments, fines and penalties for incorrect withholding on payments to foreign persons
• Be prepared for an IRS audit by providing an audit trail

Be Compliant with IRS Rules and Regulations for Payments to Foreign Persons

Although foreign nationals who are in resident alien status for federal income tax purposes are taxed like U.S. citizens, special IRS tax rules apply to payments to foreign nationals who are in nonresident alien status for tax purposes. Special withholding and reporting rules also apply to U.S. source income payments to foreign entities. The United States has treaties with over 60 countries around the world, which may reduce or eliminate federal tax withholding for foreign nationals and foreign entities from a treaty country who meet treaty conditions and provide the proper paperwork prior to payment.

Windstar’s IRS compliance software solution International Tax Navigator® helps research institutions manage their payments to foreign nationals.

International Tax Navigator determines U.S. tax residency status, tax treaty eligibility, and applicable tax rates and exemptions. The system provides web-based data collection and forms delivery, 1042-S processing, and superior client support, including web-based training, a dedicated listserv, and a client-only resource library. International Tax Navigator currently has two-way interfaces with Oracle | PeopleSoft HRMS and SunGard HE Banner HR. A one one-way interface is available for High Line HRMS. Windstar is developing interfaces with SAP and ADP.

Avoid IRS Penalties

Payments to nonresident aliens are complicated – and can be costly if the organization doesn’t follow IRS rules and regulations. For example:

• Foreign vendors – U.S. source payments through A/P require tax withholding and a 1042-S – not a 1099-MISC
• Direct compensation (payroll/employee) – requires a 1042-S if any part of the payment involves tax treaty exempt earnings
• Tax treaty exemptions from withholding - require the employer/payer to collect the proper paperwork prior to payment for tax treaty exemptions prior to payment otherwise the employer/payer can be obligated for the tax, penalties, and interest
• Form 1042-S information forms– nonfiling of 1042-S can result in per form penalties

Join our over 30 research institution clients in ensuring NRA compliance

Windstar’s client roster includes over 30 research institutions concentrating in areas such as:

• Health
• Natural energy
• Renewable energy
• Nuclear physics
• Marine biology
• Public health
• Public policy