Creighton University

Accounting Procedures

PROCEDURE TITLE:

Nebraska Nonresident Withholding

PROCEDURE NUMBER:

APPR 12

RELATED POLICY STATEMENT(S):

APPL 03

DATE ISSUED: 

December 30, 1988

DATE REVISED:

January, 2000

OVERVIEW

 

Creighton University is responsible for withholding Nebraska income tax from payments of compensation for personal services to Nebraska nonresidents when cumulative payments exceed $600 in a calendar year. As defined on Form W-4NA by the State of Nebraska, nonresidents include all individuals as well as corporations and partnerships in which the persons performing the services hold 80% or more ownership of the corporation or partnership.

REQUIRED FORM(S)

 

Form W-4NA

PROCESSING STEPS

 

In each situation in which a Nebraska nonresident performs services for the University and receives a single payment or cumulative payments of $600 or greater in a calendar year, the department is responsible for completing a Form W-4NA (see Section VI, STANDARD FORMS, for instructions). The form can be obtained from the Controller's Office or retrieved from the Forms Section of the Controller's Office Home Page. The completed form, with original signature (the State of Nebraska does not accept facsimile signatures) should be sent to the Controller's Office along with the Direct Pay Request that supports the requested payment for services. The Controller's Office cannot release a check to a nonresident in this situation until we have received the completed form.

The amount withheld from the payment to the nonresident is 4.0 percent for total calendar year payments between $600 and $28,000 and 6 percent thereafter. In cases in which cumulative payments start off less than $28,000 but eventually exceed that figure, the withholding on the final payments must be increased to ensure that 6 percent has been withheld on the total of all payments in the calendar year.