IRS Announces Withholding Change for NonResident Aliens

February 2, 2011 (PLANSPONSOR.com) – The Internal Revenue Service (IRS) has released a new guidance document announcing that procedures governing the amount of federal income tax withholding for non-resident alien employees no longer apply after January 1, 2011.

Notice 2011-12 indicates that the changes came about because the Making Work Pay Credit no longer applied after December 31, 2010, so the withholding tables will no longer reflect the credit.

The new procedures are explained in Publication 15 (Circular E), Employer’s Tax Guide, for use in 2011 and Notice 1036, Early Release Copies of the 2011 Percentage Method Tables for Income Tax Withholding.

The latest IRS notice is at http://www.iTrs.gov/pub/irs-drop/n-11-12.pdf.

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