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Set up your employee that isn’t a U.S. citizen

by Intuit•114• Updated 6 days ago

Employees who aren't U.S. citizens — referred to by the IRS as Nonresident Aliens (NRA) — may be exempt from certain payroll taxes. The specific taxes they're exempt from depend on their type of visa they have.

What you'll need

Before you begin, collect the following from your employee:

A copy of their visa
A valid Social Security number
A completed I-9 from your employee.

Note: If your employee has an Individual Taxpayer Identification Number (ITIN) instead of a Social Security number, they can't be added to payroll. An ITIN resembles a Social Security number but always begins with the number 9.

Note: If you need help understanding which payroll taxes your employee is exempt from, contact a tax professional, see IRS Publication 515, or contact your state agencies for state tax exemptions. If you’re completing this process in QuickBooks Online Payroll, you must first add your employee to payroll.

Note: Not sure which payroll service you have? Here's how to find your payroll service.

Exempt your employee from payroll taxes

Once you know which taxes apply, follow the steps for your QuickBooks Payroll product.

QuickBooks Online Payroll

For a better experience, open this article in QuickBooks Online. Launch side-by-side view .

Go to All apps , then Payroll, then Employees (Take me there).
Go to Job & pay, then select Edit ✎ from Tax withholding.
Fill in the Federal Withholding info. If your employee is exempt, select Exempt from the Filing Status ▼ dropdown.
Fill in the State Withholding info. If your employee is exempt, select Exempt from the Filing Status ▼ dropdown.
From Tax Exemptions, select the taxes your employee is exempt from.
When you’re done, select Save.

QuickBooks Desktop Payroll Enhanced

Select Employees.
Select New Employee.
Fill in the info in each section.
From the Payroll Info tab, select Taxes.
From the Federal tab, fill in the Federal W-4 info. If your employee is exempt, from the Filing Status dropdown, select Exempt.
From the Subject To section, uncheck the taxes your employee is exempt from.
Select the State tab.
Select the State Lived and State Worked.
If your employee is exempt from State Unemployment Insurance (SUI), uncheck the SUI box.
If your employee is exempt from State Withholding, from the Filing Status dropdown, select Exempt.

QuickBooks Desktop Payroll Assisted

Contact us for help setting up your employee.

Results

After completing these steps, your non-U.S. citizen employee's payroll record will reflect the correct tax exemptions based on their visa status. QuickBooks will apply these exemptions automatically when you run payroll.

Next steps

Run payroll to confirm the exemptions are applied correctly.
Retain a copy of your employee's visa and I-9 form for your records.
Check with your state agency or tax professional if exemptions change due to a visa change.