The following are subject to a 30% tax withholding rate paid to nonresident aliens, in the absence of tax treaty benefits:
- Honoraria, or payments made at the discretion of the University as compensation for professional services, including guest lectures. If honoraria and other performance-related payments from the University exceed $5000 per year, in the aggregate, the marginal earnings would also be subject to Massachusetts State tax of around 5.5%.
- Independent contractor/consultant payments issued when Harvard is charged for the service.
- Royalty payments (always considered U.S-source).
- Prizes or Awards, issued in recognition of a past accomplishment (not to be confused with a fellowship or grant for current or future research).
A resident alien for tax purposes is subject to the same tax withholding and reporting requirements as a U.S. citizen or Permanent Resident, including taxation of worldwide income.