To: UW-Madison Divisional Business Representatives (DBR) and Financial Manager Meeting

May 1, 2013

To: UW-Madison Divisional Business Representatives (DBR) and Financial Manager Meeting Representatives (FMM)

UW-System Controllers, UW System 1099MISC/1042-S/W2 Contacts, UW System Administration,

From: Jose A. Carus, Jr.

Tax Compliance Manager

Subject: New I-94 Requirements for Nonresident Aliens (NRA)

This e-mail is intended for anyone that is involved with payments to Nonresident Aliens (NRA).

Background

As all of you who deal with NRA’s are aware of, we are required by Homeland Security and the Internal Revenue Service (IRS) to obtain certain documents when making payments to NRA’s. This includes a copy of the NRA’s (1) passport (picture page) and (2) I-94, along with other documents depending on the visa status of the NRA. A flowchart with all the required documents and paperwork has been available since 2004 at the Policy and Procedure: 601-Tax Compliance, Reporting, and Withholding on Non-Salary Payments web page under the Nonresident Alien (NRA) section. The direct link to the flowchart is Required Documents for Payment, including applying for U.S. Individual Taxpayer Identification Number (ITIN) (Flowchart).

U.S. Customs and Border Protection (CBP) I-94 changes Starting April 30, 2013

The U.S. Customs and Border Protection (CBP) intends to gradually roll out a new entry-exit procedure. By the end of May, they anticipate all air and sea ports of entry will stop issuing paper I-94 cards.

No more paper I-94’s. Specifically, CBP plans to automate the Form I-94 issued at air and sea ports of entry. CBP will no longer issue arriving travelers a paper I-94 form. Instead, after scanning the traveler’s passport, CBP will create an electronic I-94 and merely stamp the passport with an admission stamp containing the date of admission, class of admission, and expiration date.

Although CBP will no longer issue a paper I-94, many employers and government agencies, such as the Department of Motor Vehicles and the Social Security Administration, require a paper version of Form I-94 to verify lawful status and employment authorization. This includes the University of Wisconsin as we require an I-94 to verify lawful status in the United States as part of our payment process.

The attached CBP memo describes “I-94 Automation” in more detail. Additional information, including the rollout schedule, is available at http://www.cbp.gov/xp/cgov/travel/id_visa/i-94_instructions/i94_rollout.xml

Attachment:

Effective Immediately (May 1, 2013) for the University of Wisconsin for NRA’s

·  If the NRA does not have an I-94, the NRA must retrieve and print out a paper version of their arrival information from www.cbp.gov/I94. The information should be available online within 24 hours after arrival.

·  The NRA must show the paying entity (1) the paper version of their arrival information, and (2) the Homeland Security Stamp in their passport for their current trip to the U.S. These documents must be attached to the Accounting Services Payment processing forms (Payment to Individual Reports, etc.), along with the photo page of the passport, and other documents as outlined in Required Documents for Payment, including applying for U.S. Individual Taxpayer Identification Number (ITIN) (Flowchart) in order for payments to be processed for Nonresident Aliens (NRA).

Please Note: This new process for NRA’s Non-Visa Waiver Countries is tailored after the same process that the UW currently has in place for NRA’s from Visa Waiver Countries. If you recall NRA’s from Visa Waiver Countries also do not get an I-94 since 2011 and thus we established the requirements and process at Visa Waiver Program and Waiver Program Countries and Documentation Requirements for them.

We have updated our Policy and Procedure: 601-Tax Compliance, Reporting, and Withholding on Non-Salary Payments web page with the new information and requirements mentioned above. The flowchart at Required Documents for Payment, including applying for U.S. Individual Taxpayer Identification Number (ITIN) (Flowchart) has also been updated.

Please pass this on to all your departments and staff that are involved in making payments to NRA’s.

Thank you.

Jose

Tax Compliance Manager

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