What is Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities?

IRS Link to Publication — Found Here

Publication 515 serves as a guide for employers with regards to the tax withholding requirements for nonresident alien employees.

It also addresses income being paid to foreign corporations and partnerships, foreign trusts and estates, and foreign governments and international organizations. Income paid by companies to employees who are not US residents will have to follow regulations including withholding and filing requirements outlines in this Publication and the referenced forms.

For foreign employees, this often means withholding 30% for US federal taxes. Sometimes FICA taxes are withheld, and sometimes they aren’t, depending on the immigration status of the employee.

It also discusses income from securities, real estate, and other assets that are paid to foreign entities from sources based in the US. Foreign individuals receiving US-sourced income may need to file Form 1042. A long list of other forms pertains to foreign entities. It is also important to note that international treaties play a role in how workers and entities are taxed.

Publication 519, US Tax Guide for Aliens, gives additional details. Publications 15, 15-A, 15-B, and 51 can also serve as references; 51 being for agricultural employers, and the 15 series addressing taxation on various kinds of compensation and employees.