Division:
Administration & Finance
Department:
University Accounting Services
Contact Information:
Campus Tax Coordinator
For inquiries regarding nonresident alien tax compliance, nonresident alien tax status, or IRS Form 1042-S reporting, please contact the Campus Tax Coordinator.
Effective Date:
Monday, January 1, 2001
Revised Date:
Tuesday, June 9, 2026
Authority:
HR 2001-15 dated Thursday, May 17, 2001
This directive is governed by applicable federal and state tax laws and regulations, including but not limited to IRS withholding requirements under Internal Revenue Code Section 1441, California Franchise Tax Board nonwage withholding requirements, and applicable international tax treaties.
• U.S. Tax Information for Nonresident Aliens
• CSU Nonresident Alien Tax Manual
Objective:
The most recent systemwide financial audit of the CSU found "significant absence of procedures and controls" and "deficiencies in complying with rules" governing Non-Resident Alien Taxation (NRAT) and numerous other tax rules and regulations. Compliance with tax requirements has recently become an important issue for U. S. colleges and universities because of aggressive audits by the Internal Revenue Service, which result in heavy penalties, fines, and back taxes.
Statement:
The Chancellor's Office is committed to ensuring tax compliance throughout the CSU and has issued a Nonresident Alien Tax Manual, which each campus is required to implement. In order to comply with provisions of the Internal Revenue Code, Treasury Department regulations, and the California Revenue and Taxation Code, each CSU campus and auxiliary organization is required to withhold taxes from payments made to (or on behalf of) nonresident aliens. Since this requires actions by many campus departments that initiate and process payment transactions, a central coordinating point is needed
Process:
In order to ensure compliance with Federal and State requirements, all campus departments and auxiliary organizations are expected to comply with the campus Non-Resident Alien Taxation (NRAT) program as established by the CSU Nonresident Alien Tax Manual, this policy, and the implementing procedures issued by campus administrative offices.
Assignment of Responsibility
Internal Audit will coordinate the NRAT compliance program, working with Human Resources, Accounts Payable, Procurement, Student Financial Aid, Office of International Programs, other transaction processing departments, and the auxiliary organizations to:
- develop policies, procedures, guidelines, and forms;
- develop training materials and make presentations to all campus departments;
- maintain a NRAT Web site;
- ensure required reports and remittances are made to the Internal Revenue Service and the Franchise Tax Board;
- research tax treaties and provide information to campus departments and nonresident alien individuals.
All campus departments and auxiliary organizations will implement the NRAT compliance program by becoming familiar with NRAT procedures, identifying nonresident aliens when hiring or initiating a payment to an individual, and obtaining and processing required forms.
[Archived Approved University Executive Order for reference: University Executive Directive #01-23 - Nonresident Alien Taxation]