Identifying Individuals for Analysis

Federal law dictates that Towson University must determine a person's tax status for those individuals who are not U. S. Citizens or Permanent Resident Aliens..  The Internal Revenue Services has four categories of tax residency status. These are NOT immigration categories!

• United States citizen
• Permanent resident alien
• Resident alien for tax purposes
• Nonresident alien for tax purposes

All of Towson University's payment forms ask the question:  "Are you or the beneficiary of this payment a US Citizen or Permanent Resident Alien?" If the answer is no, then individuals are referred to the Nonresident Alien Tax Office for a tax analysis.  The tax analysis will conclude the individual is one of the following:

Resident Alien for Tax Purposes (RA)

A resident alien for tax purposes is subject to the same tax regulations as a U. S. Citizen. Resident aliens are taxed on their worldwide income.

Nonresident Alien for Tax Purposes (NRA)

Separate tax laws regulate those who qualify as a nonresident alien for tax purposes. Nonresident aliens for tax purposes are only taxed on their “U. S. source” income.

NRA and RA definitions apply only on the federal level. The definitions and purpose do not apply on the state level in the same manner.

Determining Tax Status

• A calculation called the Substantial Presence Test (SPT) is used to determine your tax status of RA or NRA. The key factors of the substantial presence test is the history of U.S. visits and immigration classification during those visits. Click here for examples.
  
• Towson University uses Glacier™ to determine tax status.
  
• If the information required for the Substantial Presence Test is not available, the University must by law presume the individual is a NRA and withhold tax accordingly.
  

• Any reference to “nonresident alien” or NRA on this website means a nonresident alien for tax purposes.