Policy and Procedure: 601-Tax Compliance, Reporting, and Withholding on Non-Salary Payments


Statement of Policy and Procedure

The University of Wisconsin System will report taxable payments to the IRS, Wisconsin Department of Revenue, and the individual receiving the payment and withhold federal or state income taxes from payments as required by Federal and State laws. Also, the University of Wisconsin will require social security numbers or Individual Taxpayer Identification Numbers (ITINs) for non-resident aliens as required by Federal law.

In general, payments to an individual may be considered taxable income, subject to federal and/or state tax. The purpose of this policy is to discuss which types of non-salary income are taxable and which tax forms are used to report that income to the federal and state government and the individual.

Tax Compliance and Financial Reporting Mission, Goals, and Objectives


Employee Payments

    • All employee service payments must be processed through the Human Resources System (HRS). Employee business expenses must be processed through the E-Reimbursement system. The only exception is for payments to employee for participating in Research Subject studies which can be paid either through (1) HRS or (2) a Payment to Individual Report (PIR).

Federal and State Tax Reporting

Federal Tax Withholding

Forms

Nonresident Alien (NRA)

Non-U.S. Source Income (Payments to Non-Resident Aliens for work performed Outside the U.S.)

Payment Methods (Allowable for Tax Reportable Payments)

Payment Recipient Types

Resolving Tax Issues Prior to Payment

Sales and Use Tax

Training

Tuition Reporting (1098-T and 1098-E)

W-9 for UW (IRS Approved Substitute W-9 for UW)

W-9 Compliance

Wisconsin Entertainer Tax

Year End Tax Reporting/Responsibilities

Appendix 1 -UW-Madison Interpretation/Definition of Entertainer

Appendix 2 -Important Tax Information


Contact

Jose A. Carus Jr.