Income Tax Treaties for Short-Term Visitors
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Tax treaties that contain an article to exempt independent personal services or fellowship income may have
additional requirements that must be met such as a tax residency requirement, a limitation on the number of days the individual
performs services in the U.S., restriction on the source of the income, and limitations on the amount of income that can be exempt
in a given calendar year. The existence of a tax treaty between the U.S. and the visitors country of tax residence does not guarantee
that the visitor will be eligible to take advantage of the treaty benefits.
Tax treaty benefits may be applied for prior to the income actually being paid or at the time the individual files a U.S. income
tax return. If IU rejects a visitors application for tax treaty benefits the payment will be subject to the required rate of income
tax withholding and the individual may attempt to claim the tax treaty based exemption when they file their income tax return.
If an individual uses a tax treaty based exemption from tax withholding at the time of payment the individual is REQUIRED to file
a U.S. income tax return. Failure to file an income tax return may result in the IRS denying the treaty benefits previously granted
which may result in additional income taxes, penalties, and interest to the visitor.
How to apply for tax treaty benefits:
A completed International Tax Questionnaire (ITQ) and other documents are required in order to determine whether a
visitor is eligible to claim a tax treaty based exemption from withholding. These documents should be submitted along with the
Disbursement Voucher (DV) or Payment Requisition (PREQ) documentation. The tax department will review the documentation submitted and will
determine whether the individual is eligible to claim the benefits of the tax treaty. If eligible, the tax department will generate IRS
Form 8233 or W-8BEN claiming treaty benefits to be signed by the visitor. The tax department is required to send a copy of Form
8233 to the IRS for review if IU accepts and applies these treaty benefits.
Documentation required for tax treaty based exemption is as follows:
- International Tax Questionnaire (ITQ)
- Copy of the I-94 Departure Card
- Copy of the identification page of the passport (if available)
- Copy of application for social security number (SSN) or individual taxpayer identification number (ITIN) if the individual does not have
an SSN or ITIN listed on the ITQ.
- Copy of the visitor's I-20 (F status) or DS-2019 (J status)
- Properly completed and signed copy of the 8233 and additional certification statement (if applicable) or Form W-8BEN with Section II completed.
A U.S. tax ID number, or proof of application for a U.S. tax ID number, is required before
Indiana University can generate the Form 8233. If the visitor does
not have a U.S. tax ID number but wishes to apply for one during their visit to IU, see
Applying for an ITIN to determine the appropriate process.
The Tax Treaty Countries page provides a list of countries that contain treaty articles exempting income from tax.
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