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Seasonal Employers and Foreign Student Workers

June 22, 2021 | posted by Abacus Payroll

If you are a seasonal employer, you are probably used to the difficult process of determining how much federal income tax to withhold from the wages paid to a nonresident alien employee working in the United States. Going through the following steps will help employers figure out this tedious tax calculation.

Step 1: Determine W-4 Status

Use the following chart to add the additional amount to their wages paid only if the employee has submitted a Form W-4 for 2020 or later or the first wages paid to the employee began in 2020 or later.

Payroll Period Add Additional
Weekly $241.30
Biweekly $482.70
Semimonthly $522.90
Monthly $1,045.80
Quarterly $3,137.50
Semiannually $6,275.00
Annually $12,550.00
Daily or Miscellaneous (each day of the payroll period) $48.30

 

If this is not the case and the employee was first paid wages before 2020 and has not submitted the 2020 Form W-4 or later, use the below table to determine how much to add to his or her wages for calculating federal income tax withholding.

Payroll Period Add Additional
Weekly $158.70
Biweekly $317.30
Semimonthly $343.80
Monthly $687.50
Quarterly $2,062.50
Semiannually $4,125.00
Annually $8,250.00
Daily or Miscellaneous (each day of the payroll period) $31.70

Step 2: Enter Total Taxable Wages

On line 1a of the withholding worksheet for federal income tax withholding, enter the amount determined from the table.

No Tax Increase will Apply

It is important to note that the amount added to wages is for the sole purpose of calculating income tax withholding and should not be included in any part of the employee’s W-2 form. Also, this amount will not increase the employee’s income tax liability, the FICA tax liability of the employer or employees, or the FUTA tax liability.

 

Running a business isn’t easy and many seasonal employers face the same obstacles. Abacus Payroll Relationship Manager, Lindsey Cowperthwait, presented payroll tips for seasonal employers in our recent webinar, click here to watch the webinar. If you have any questions specific to your payroll for non-US residents, please contact Abacus Payroll.

 


About the Author: Abacus Payroll

Abacus Payroll, Inc. is a leading provider of payroll solutions for businesses of all sizes. Whether yours is a family-owned small business or a national corporation, we provide payroll, tax and other financial services on time and at an affordable price. Unlike other payroll providers, Abacus Payroll will assign your very own payroll specialist who will understand your payroll needs inside and out. So no more speaking to a different person each time, no more sitting on hold for hours and most importantly no more missed deadlines! Contact us today to see how we can help your business. You can count on us.