TAXES 16-30, Nonresident Alien Federal Income Tax Withholding | National Finance Center

TAXES 16-30, Nonresident Alien Federal Income Tax Withholding

Published: December 28, 2016
Effective: Pay Period 25, 2016

Summary

Effective January 1, 2017, the Nonresident Alien Federal income tax withholding formula will change:

Beginning with salary payments for Pay Period 25, 2016, Federal income tax will automatically be withheld in accordance with the new formula. No action on the part of the employee or the personnel office is necessary.

Tax Formula

Acceptable Exemption Form:

W-4

Basis for Withholding:

Federal Exemptions

Acceptable Exemption Data:

S/M, Number of Allowances

TSP Deferred:

Yes

Special Coding:

Determine the Total Number of Allowances as follows: Exemption Code N is the only acceptable code for nonresident aliens. Claim only one exemption, unless a resident of Canada, Mexico, South Korea, or a United States national.

Additional Information:

None

Withholding Formula (Effective Pay Period 25, 2016)

  1. Subtract the nontaxable biweekly Thrift Savings Plan contribution from the gross biweekly wages.
  2. Subtract the nontaxable biweekly Federal Health Benefits Plan payment(s) (includes dental and vision insurance program, and flexible spending account - health care and dependent care deductions) from the amount computed in step 1.
  3. Add the taxable biweekly fringe benefits (taxable life insurance, etc.) to the amount computed in step 2 to obtain the adjusted gross biweekly wages.
  4. Multiply the adjusted gross biweekly wages times 26 to obtain the gross annual wages.
  5. Add $2,300 to the employee's annualized gross wages.
  6. Determine the personal exemption by applying the following guideline and subtract this amount from the gross wages to compute the taxable income:

    Exemption Allowance = $4,050 x Number of Exemptions

  7. Apply the taxable income computed in step 6 to the following table to determine the Federal income tax withholding:

    Tax Withholding Table Single or Head of Household

    If the Amount of Taxable Income Is:

    The Amount of Federal Income Tax Withholding Should Be:

    Over $0 but not over $2,300

    $0

    Over $2,300 but not over $11,625

    $0 plus 10.0% over $2,300

    Over $11,625 but not over $40,250

    $932.50 plus 15.0% over $11,625

    Over $40,250 but not over $94,200

    $5,226.25 plus 25.0% over $40,250

    Over $94,200 but not over $193,950

    $18,713.75 plus 28.0% over $94,200

    Over $193,950 but not over $419,000

    $46,643.75 plus 33.0% over $193,950

    Over $419,000 but not over $420,700

    $120,910.25 plus 35.0% over $419,000

    Over $420,700

    $121,505.25 plus 39.6% over $420,700

     

    Tax Withholding Table Married

    If the Amount of Taxable Income Is:

    The Amount of Federal Income Tax Withholding Should Be:

    Over $0 but not over $8,650

    $0

    Over $8,650 but not over $27,300

    $0 plus 10.0% over $8,650

    Over $27,300 but not over $84,550

    $1,865.00 plus 15.0% over $27,300

    Over $84,550 but not over $161,750

    $10,452.50 plus 25.0% over $84,550

    Over $161,750 but not over $242,000

    $29,752.50 plus 28.0% over $161,750

    Over $242,000 but not over $425,350

    $52,222.50 plus 33.0% over $242,000

    Over $425,350 but not over $479,350

    $112,728.00 plus 35.0% over $425,350

    Over $479,350

    $131,628.00 plus 39.6% over $479,350

  8. Divide the annual Federal income tax withholding calculated in step 7 by 26 to obtain the biweekly Federal income tax withholding.

Resources

To view the updated tax formula, go to the HR and Payroll Clients page from the MyNFC drop-down menu on the National Finance Center (NFC) homepage. Select the Publications tab in the center ribbon. Select U.S. Income Tax Formulas from the Publication menu to launch the tax map. Select the desired State from the map provided for the formula.

Previous Tax Bulletin

Inquiries

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