Services or Work Outside the USA
An international person or nonresident alien (NRA) is subject to US income tax only on US source income. The general rules for determining US source income that apply to most nonresident aliens are shown below. Please note that only the types of income most relevant to Vanderbilt University, our employees, vendors and business visitors are shown. Additional information on other types of income can be found on the IRS website.
|TYPE OF INCOME||FACTOR DETERMINING SOURCE OF INCOME|
|Salary Wages & Other Compensation||Where services performed|
|Business Income: Personal Services||Where services performed|
|Business Income: Sale of Inventory (Purchased)||Where inventory sold|
|Business Income: Sale of Inventory (Produced)||Where produced (allocation may be needed)|
|Scholarships & Fellowships||Residency of the taxpayer|
|Royalties: Patents, Copyrights, etc.||Where property is used|
The International Tax Office will examine each situation individually to determine if the international person falls under the category of contractor or employee. If the international person is an employee, the department is advised to contact the Office of the General Counsel to discuss whether Vanderbilt has corporate or employment obligations in the country of employment activity.
- Source of Income - Personal Service Income
- Income Subject to NRA Withholding
- Pay for Personal Services Performed
A detailed discussion of the general rules is provided in Chapter Two of Publication 519, U.S. Tax Guide for Aliens .