Reporting Requirements

1. Form 1099

  1. Form 1099-Misc is required when an individual receives nonemployee income of $600 or more from services, rents, prizes, awards, and research subject payments in any combination, or income of $10 or more from  royalties.
  2. Form 1099-K may be required for campus card programs that enable students to charge purchases at businesses unrelated to the institution. This includes agreements with another business entity to lease space (such as food service providers, bookstore operators, or vending machine distributors), where the institution is contractually obligated to pay in settlement of cardholder transactions. If a campus card program is outsourced to a bank or other third party, that entity, assuming it actually makes the payments to the merchants, would be the one required to file the Form 1099-K.

These payments are accumulated by calendar year for the entire UW System and reported to the Internal Revenue Service and the Wisconsin Department of Revenue by the UW System Administration.

2. Form 1042S

Each processing center will report all payments for services to nonresident aliens and applicable withholding on IRS Form 1042S. These payments are reported to the Internal Revenue Services by the UW Service Center.

Withholding Requirements

See the UW Responsibilities as a Withholding Agent document for additional information.

1. Non-U.S. Resident Aliens

The appropriate tax will be withheld based on IRS Section 1441 and existing tax treaties. Withholding is required at 30% (less prorated personal exemption amount) on payments for services unless:

  1. income is non-U.S. Source,
  2.  payment is effectively connected with a U.S. trade or business and individual has filed Form W-8ECI, or
  3.  income is partially or totally exempt or subject to a reduced withholding rate due to a tax treaty and individual has filed Form 8233 to claim the exemption or reduced rate.
  4.  Income is subject to a reduced withholding rate (14%) by IRS Code for scholarships/fellowships for F-1 and J-1 visa holders.  Tax reportable scholarships/fellowships to NRAs are processed through the Payroll and Glacier systems.

2. U.S. Residents

Withholding is required at the rate of 28% on payments for services if SSN is not provided.

3. Non-Wisconsin Resident Entertainers

Institutions must withhold 6% of payments to nonresident entertainers if accumulated payments for entertainment services exceed $7,000 (including travel reimbursements) in a calendar year and the entertainer has not filed WT-11 with a surety bond or cash deposit, or provided a waiver from the Department of Revenue. Each institution must institute a procedure for accumulating payments to nonresident entertainers to determine if the $7,000 limit has been reached.