Payments to Nonresidents

Guest Speakers | Foreign Source Income | Consultants

Visiting scholars who enter the U.S. on a B-1 Visa may not perform "employment" services in the U.S.. This includes consulting services paid as an independent contractor.

However, a B-1 Visitor may be paid an honorarium for usual academic activities. The following conditions must be met:

• The services must be conducted for the benefit of Drexel University or Drexel University College of Medicine
• The activities will not last longer than nine days
• The individual has not accepted such payments for expenses from more than five institutions or organizations in the last six months (the 9/5/6 B Honorarium Rule).

 

Guest Speakers

All honorariums are taxable with the following exception: the speaker has a social security number or International Taxpayer Identification Number (ITIN) AND is from a country with a tax treaty. If the speaker is from a country with a tax treaty but does not have a social security number/ITIN, they can apply for an ITIN from the IRS. Please refer to the IRS website at www.irs.gov.

When filling out the Check Request, please clearly write your contact information (phone and email) as clear correspondence is essential for the successful payment of the honorarium. Also, please indicate if the speaker has a SS#/ITIN. If the speaker has no number, there are three routes we can take:

1. 30% will be taken out of the honorarium payment.
2. Your department can gross up the amount so that, after taxes, the speaker will receive the agreed amount.
3. The guest speakers can apply for an ITIN from the IRS (time consuming).

Foreign Source Income

If you wish to pay a foreign national for services performed outside of the United States, the foreign national must sign the appropriate form below and mail it back to us.
Drexel University form
Drexel College of Medicine form

Consultants

A foreign national receiving a consulting fee is subject to 30% U.S. tax withholding unless both of the following conditions exist:

• They are from a country with a tax treaty that exempts compensation for independent personal services and,
• They have a U.S. social security number (SSN) or an individual tax identification number (ITIN).

Foreign nationals doing consulting in the U.S. must have the appropriate visa. B-1 Visas or WB (Waivers for Business) are not appropriate visas for independent consultants.