U.S. immigration and tax laws restrict the types of payments that may be made to foreign nationals. Before inviting an international scholar, speaker, performer, or other foreign visitor to campus, departments must ensure that the individual holds the appropriate immigration status to receive payment. The fact that a visitor is already in the United States does not necessarily mean they are authorized to receive an honorarium, reimbursement, or other compensation.

Departments should not assume a visitor's eligibility based solely on their presence in the United States. Visa classification must be verified using immigration documentation, such as the visitor's passport, visa, and Form I-94 Arrival/Departure Record.

Click here to access the chart of most commonly used visa and payment eligibility.

Under the American Competitiveness and Workforce Improvement Act of 1998 (ACWIA), honorarium payments may be made to certain visitors in B-1, B-2, WB, or WT (Visa Waiver Program) status if specific requirements are met.

An honorarium is a payment made in recognition of services performed in connection with a usual academic activity, such as a lecture, presentation, seminar, or similar event.

To qualify for an honorarium payment under ACWIA:

• The activity must be a usual academic activity.
• The visitor's stay at Stockton University must be nine (9) days or less.
• The visitor must not have accepted honoraria or expense reimbursements from more than five institutions or organizations during the previous six-month period (the "9/5/6 Rule").
• The visitor must be present in an eligible immigration status, such as B-1, B-2, WB, or WT.

Canadian citizens generally do not require a visa but must still meet the applicable immigration and tax requirements.

Taxation of Honorarium Payments

For U.S. tax purposes, honorarium recipients are generally treated as independent contractors. Payments made to nonresident aliens may be subject to 30% federal tax withholding, unless the individual qualifies for a reduced withholding rate or exemption under an applicable U.S. income tax treaty.

The tax treatment of an honorarium depends on several factors, including:

• Immigration status
• Country of tax residence
• Availability of a U.S. tax treaty
• Compliance with the 9/5/6 Rule
• Presence of a valid U.S. taxpayer identification number

The Tax Department will review each case to determine the appropriate tax treatment.

Required Documentation

To determine payment eligibility and the proper tax treatment, the following documents must be submitted to the Tax Department:

• Letter of Invitation (See below for details)
• Honorarium Certification Statement
• Foreign Visitor Information Sheet
• Guide for Honorarium Payments
• Copy of Form I-94 (if applicable)
• Copy of passport photo page
• Copy of passport expiration page (if not shown on the photo page)
• Copy of visa (if applicable)
• IRS Form W-8BEN
• Copy of Social Security Number (SSN) card or Individual Taxpayer Identification Number (ITIN) documentation
• IRS Form 8233 (if claiming tax treaty benefits)

Important: A valid U.S. Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) is required to claim tax treaty benefits. If the visitor does not have an SSN or ITIN, federal tax withholding will generally apply. See IRS Publication 519 for additional information.

Please submit all required forms and supporting documentation to the Tax Department.

Letter of Invitation Requirements

A letter of invitation should be provided to every foreign national who will receive an honorarium and/or reimbursement of travel expenses. The letter should be prepared by the sponsoring department and include:

• Name of the event or activity
• Date(s) and location of the event
• Amount of the honorarium, if applicable
• Description of any travel or incidental expense reimbursements
• Contact information for the sponsoring department

Sample Invitation Letter

Usual Academic Activities

Federal regulations define usual academic activities broadly and may include:

• Lectures and presentations
• Teaching and instruction
• Sharing knowledge or research
• Master classes and workshops
• Academic readings and performances
• Service on boards, committees, or advisory groups that benefit the institution

To qualify as a usual academic activity, events generally must be educational in nature and open to students and/or the public without the sale of general admission tickets. Activities that are primarily commercial in nature may not qualify.

Scholarships, Fellowships, and Grants

Scholarship and fellowship payments may be taxable depending on how the funds are used.

Generally Non-Taxable

Amounts used for:

• Tuition
• Required fees
• Required books and course materials

Generally Taxable

Amounts used for:

• Housing
• Meals
• Travel
• Living expenses
• Other non-qualified expenses

Taxable scholarship payments to nonresident aliens may be subject to federal tax withholding and may be reported on Form 1042-S.

International students employed by Stockton University are subject to federal and state tax laws, as well as immigration regulations that may affect their employment eligibility and tax withholding requirements. Understanding these rules can help students remain compliant with both tax and immigration requirements while studying in the United States.

Topics related to student employment include:

• Federal and State Income Tax Withholding – Wages earned from employment may be subject to federal and state income tax withholding. The amount withheld depends on the student's tax residency status, earnings, and withholding elections.
• Form W-4 Completion – Students must complete Form W-4 when beginning employment. Nonresident alien students may be required to follow special IRS instructions when completing the form.
• Form W-2 Wage Reporting – At the end of each calendar year, students who received wages will receive Form W-2 reporting their taxable earnings and taxes withheld. This form is used when preparing annual income tax returns.
• Student FICA Exemption – Certain students employed by the University may qualify for an exemption from Social Security and Medicare (FICA) taxes while enrolled and regularly attending classes. Eligibility is determined under IRS guidelines and may vary based on enrollment status and employment circumstances.
• Employment Eligibility Requirements – International students must maintain valid immigration status and comply with employment authorization requirements associated with their visa classification. Unauthorized employment may have significant immigration consequences.
• Tax Filing Requirements – International students may be required to file federal and state tax returns each year, even if no tax is owed. Filing requirements depend on immigration status, residency status for tax purposes, and income earned during the year.
• Tax Treaty Benefits – Students from certain countries may be eligible to claim benefits under an income tax treaty between the United States and their home country. Eligibility requirements vary by treaty and individual circumstances.
• Required Tax Documentation – International students may be asked to provide documents such as a passport, visa, Form I-20 or DS-2019, I-94 arrival record, Social Security Number (SSN), or Individual Taxpayer Identification Number (ITIN) to establish employment eligibility and determine the correct tax treatment.

Students are responsible for ensuring that their immigration status permits employment and that they comply with all applicable visa restrictions. Questions regarding employment authorization should be directed to the Office of Global Engagement, while tax-related questions may be directed to the Tax Office.

U.S. tax obligations depend on whether you are classified as a Resident Alien or Nonresident Alien for tax purposes. Tax residency is determined under Internal Revenue Service (IRS) rules and may differ from your immigration status.

Generally:

• F-1 and J-1 students are typically considered nonresident aliens during their first five calendar years in the United States.
• J-1 scholars and researchers are generally exempt from the Substantial Presence Test for their first two calendar years.
• Individuals who meet the Substantial Presence Test may become resident aliens for tax purposes.

Tax residency status affects tax withholding, tax treaty eligibility, and tax return filing requirements.

 

Many international students and visitors are required to file U.S. tax forms, even if they did not earn income during the year.

Common forms include:

• Form 8843 – Required for most nonresident aliens in F, J, M, or Q status.
• Form 1040-NR – U.S. Nonresident Alien Income Tax Return.
• State income tax returns, if applicable.

The Tax Department cannot provide individual tax advice or prepare tax returns. Students should consult IRS resources or a qualified tax professional for assistance.

Helpful Resources

• IRS Publication 519 – U.S. Tax Guide for Aliens
• IRS Foreign students, scholars, teachers, researchers and exchange visitors 
• IRS Forms and Instructions
• New Jersey Division of Taxation

 

The United States maintains income tax treaties with a number of foreign countries that may provide reduced tax rates or exemptions from U.S. federal income tax for certain types of income earned by international students, scholars, researchers, and visitors. These agreements are intended to help prevent double taxation and encourage educational, cultural, and research exchanges between countries.

Depending on the specific treaty and the individual's circumstances, treaty benefits may apply to:

• Scholarships and Fellowships – Certain treaty provisions may exempt all or a portion of scholarship or fellowship payments from U.S. taxation.
• Compensation for Services – Income earned through employment, assistantships, internships, or other services may qualify for a reduced rate of tax or an exemption under some treaties.
• Honoraria – Payments received for lectures, presentations, guest speaking engagements, or similar academic activities may be eligible for treaty benefits.
• Research or Teaching Activities – Visiting professors, teachers, researchers, and scholars may qualify for special treaty provisions that exempt compensation for a limited period of time.

To claim tax treaty benefits, eligible individuals may be required to provide supporting documentation and complete specific IRS forms before payments are made. Depending on the type of income, required forms may include:

• IRS Form 8233 – Used by nonresident aliens to claim an exemption from withholding on compensation for personal services, including wages, honoraria, and independent personal services.
• IRS Form W-8BEN – Used to certify foreign status and claim treaty benefits on certain non-wage payments.
• Valid Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) – Most treaty claims require a U.S. taxpayer identification number. Individuals without an SSN may need to obtain an ITIN before treaty benefits can be granted.

Tax treaty eligibility is determined on a case-by-case basis and depends on several factors, including:

• Country of tax residence
• Immigration status and visa classification
• Type of income received
• Length of stay in the United States
• Prior presence in the United States
• Specific provisions contained in the applicable tax treaty

Claiming a tax treaty benefit does not automatically exempt an individual from U.S. tax filing requirements. Individuals who receive treaty-exempt income may still be required to file annual federal tax forms with the IRS.

Because treaty provisions vary significantly by country and individual circumstances, Stockton University reviews treaty claims individually and may request additional documentation before approving a treaty exemption.

The University cannot provide personal tax advice, and individuals with complex tax situations should consult a qualified tax professional.

Depending on the type of payment received, foreign students and visitors may receive one or more of the following tax forms:

Form W-2

Issued for wages paid to employees.

Form 1042-S

Issued for:

• Taxable scholarships and fellowships
• Honoraria
• Tax treaty exempt income
• Other payments made to nonresident aliens

Form 1099

Issued in limited circumstances when required under IRS reporting rules.

Do I need to file a U.S. tax return?

Many international students, scholars, researchers, and visitors are required to file one or more U.S. tax forms each year, even if they did not earn income in the United States. Filing requirements depend on your immigration status, tax residency status, and the type of income received during the year.

Examples of individuals who may have a filing requirement include:

• Students receiving scholarships, fellowships, or grants
• Employees receiving wages reported on Form W-2
• Individuals receiving honoraria or other payments reported on Form 1042-S
• Dependents in certain visa classifications
• Individuals claiming tax treaty benefits

Failure to file required tax forms may result in penalties or affect future immigration applications. Because filing requirements vary by individual circumstances, students and visitors should review IRS guidance carefully or consult a qualified tax professional.

 

Why did I receive Form 1042-S?

Form 1042-S, Foreign Person's U.S. Source Income Subject to Withholding, is issued to nonresident aliens who receive certain types of U.S.-source income. The form reports both the income paid and any federal tax withheld during the calendar year.

Common payments reported on Form 1042-S include:

• Taxable scholarships and fellowships
• Tax treaty-exempt income
• Honoraria and guest speaker payments
• Research participant payments
• Royalties and other non-wage payments
• Compensation exempt under an applicable income tax treaty

It is common for an individual to receive both a Form W-2 and a Form 1042-S during the same tax year. Each form reports different types of income and may be needed when preparing a federal or state tax return.

 

Can I claim tax treaty benefits?

Possibly. The United States has income tax treaties with many countries that may reduce or eliminate U.S. federal income tax on certain types of income. However, eligibility is determined individually and depends on several factors.

These factors may include:

• Your country of tax residence
• Visa classification (such as F-1, J-1, M-1, or other eligible statuses)
• Length of time spent in the United States
• Type of income received
• Prior visits to the United States
• Compliance with IRS documentation requirements

To claim treaty benefits, you may be required to submit IRS forms and supporting documentation before payment is made. Treaty benefits are not automatic, and approval is subject to IRS regulations and University review procedures.

 

How do I obtain an ITIN?

An Individual Taxpayer Identification Number (ITIN) is a tax processing number issued by the Internal Revenue Service (IRS) to individuals who are required to have a U.S. taxpayer identification number but are not eligible for a Social Security Number (SSN).

To apply for an ITIN, individuals must submit:

• IRS Form W-7, Application for IRS Individual Taxpayer Identification Number
• Required identity and foreign status documentation
• Supporting tax documents as required by the IRS

In many cases, an ITIN application must be submitted with a federal tax return unless an IRS exception applies.

International visitors claiming tax treaty benefits may be required to obtain an ITIN if they are not eligible for an SSN. Because ITIN processing can take several weeks, individuals should begin the application process as early as possible when an ITIN is needed for tax reporting or treaty benefit claims.

 

What is the difference between a Social Security Number (SSN) and an ITIN?

A Social Security Number (SSN) is issued by the Social Security Administration and is generally available to individuals who are authorized to work in the United States.

An ITIN is issued by the IRS solely for tax administration purposes and does not provide employment authorization or immigration benefits.

Individuals who are eligible for an SSN should not apply for an ITIN.

 

Why was federal tax withheld from my scholarship?

Scholarships used for qualified education expenses, such as tuition and required fees, may not be taxable. However, amounts used for other expenses, including room, board, travel, insurance, and living expenses, are generally considered taxable income.

For nonresident alien students, taxable scholarship payments may be subject to federal tax withholding unless reduced or exempt under an applicable tax treaty.

 

Who should I contact if I have questions?

Questions regarding immigration status, visa requirements, and employment authorization should be directed to Stockton University's Office of Global Engagement.

Questions regarding tax forms issued by Stockton University, tax withholding, tax treaty documentation, or Form 1042-S reporting may be directed to the University's Tax  Office.

Please note that Stockton University cannot provide personal tax advice. Individuals with questions regarding their personal tax situation should consult a qualified tax advisor or tax preparation professional.