Crew Forms for Nonresidents

Dear Crewmember:

AvMar Payroll Services Inc. has been retained by your employer to process crew payroll and ensure their compliance with US Payroll Tax Law. It is the non-resident crewmember’s responsibility to determine whether they have a tax filing responsibility in the United States and if they are unsure as to their tax responsibilities it is recommended they engage the services of an independent tax professional to provide guidance.

For payroll to be processed timely we require that all requested forms be completed in their entirety in a clear and legible manner. As you review your crew packet you will notice that there is a detailed description explaining the purpose of each form. If after reviewing the crew forms in their entirety you still have questions, please contact our office to discuss.

After reviewing the following please initial and date at the bottom of each page of this introduction letter and return with your crew packet to AvMar.

Please complete the attached forms:

1. Crew Information Sheet

2. Form W-4 Employee’s Withholding Allowance Certificate

3. Form 8233 Exemption from Withholding Based on Tax Treaty Benefits

4. Provide a copy of your Passport

Items 3 is only required if the crew member believes that they are exempt from withholding because they qualify for tax treaty benefits (please see attached explanation page regarding form 8233).

Frequently Asked Questions Crewmembers

Q. If I am working on a foreign flagged vessel for a foreign employer, how can I be liable for US tax?

A. The flag of the vessel and the jurisdiction of the foreign employer are irrelevant to determine where income is “sourced”. If your income is earned in the United States territorial waters, then that income is considered sourced in the U.S. for tax purposes.

Q. Why do some vessels withhold tax from my salary and other vessels do not?

A. We cannot speak for other vessels that you have worked on; however, this employer has been formed in a manner that requires tax to be withheld unless an exception applies.

Q. What is the exception?

A. Generally, taxes are not required to be withheld by the employer if the “Tax Treaty” exception applies. This exception allows the employer to not withhold taxes so long as you are a resident tax filer in your country of residency, and you are not present in the US territorial waters for more than 183 days over the course of a 365-day period. If a tax treaty exception is scrutinized by the Internal Revenue Service, the burden of proof is on the crewmember to provide supporting documentation that they are a tax resident of their home country in compliance of Article 4 of their respective tax treaty.

(Please note: not every country has a tax treaty with the United States and some countries have treaties that allow for shorter periods of time to be spent in the US. We must look at each crew member on an individual basis to determine their specific circumstances).

Q. What if I am present in the United States for more than 183 days during the year?

A. If you are traveling on a B1/B2 Visa your stay is considered temporary and you should avoid triggering the SPT “substantial presence test”. Typically stays exceeding 183 days will trigger the SPT and may result in the United States treating you as a “resident” for tax purposes. This basically means the IRS is considering you as living here, making your worldwide income subject to United States income tax. It is the crewmember’s responsibility to notify the employer if that crewmember has triggered the SPT. If you have questions regarding the SPT please call Tom Andrews, CPA, at 954-764-0404 to discuss in more detail.

Q. What happens if I realize after taxes are withheld that I qualified for a tax withholding exception?

A. Once tax is withheld and remitted to the IRS AvMar is unable to reverse that tax deposit and the crewmember’s only recourse will be to file a nonresident tax return after the year has ended. It is important that the crewmember coordinate with their employer so that the days present in the United States are reconciled prior to being provided to AvMar Payroll.

Q. What does AvMar do with the taxes withheld from my paycheck?

A. AvMar is required by law to transmit your taxes to the Internal Revenue Service every pay period.

Q. Will the tax withheld from my salary be refunded to me?

A. Probably not, the tax being withheld is the tax that would otherwise be due on your US source income. It should be noted that it is the nonresident crewmember’s responsibility to determine whether they have a tax filing responsibility in the United States. If the nonresident crewmember determines through their own independent tax advisor that they are exempt from US income tax or are due a refund, it is the nonresidents responsibility to lodge an income tax return with the Internal Revenue Service and request a refund.

Crew Member Initial and Date(Required)

1. CREW INFORMATION

Vessel Name

Hire Date

Your Full Name

Address

Street Address City State / Province / Region ZIP / Postal Code

Phone Number

Email Address

Bank Name

Bank Address

(Please provide at least the state in which you originally opened your account if you do not have the street address)

Account #

Type of Account

ABA/Routing

(Provide the ABA/routing for direct deposit/ACH)

SWIFT/BIC Code

(This is for international wires)

IBAN # (for accounts in UK & Europe)

Annual Salary ($)

Position

Date of Birth

Place of Birth

Marital Status

Nationality

Emergency Contact

Please provide our office with a copy of your passport in addition to all requested forms.

PAYROLL WILL NOT BE PROCESSED UNTIL THE CREW PACKET IS COMPLETED IN ITS ENTIRETY. ALL FORMS MUST BE LEGIBLE.

Thank you! We look forward to working with you!

AvMar is not responsible for delays in pay due to incorrect account information submitted on this form, such as closed accounts, incorrect ABA, etc.

We suggest you or your captain submit this paperwork to AvMar via a secure email.

2. Form W-4 Employee’s Withholding Allowance Certificate

The IRS requires that we have a signed copy of this form for every crewmember. Please complete Step 1 and sign/date Step 5.

Step 1: Enter Personal Information

1A. First name and middle initial(Required)

1A. Last name(Required)

1B. Social Security Number(Required)

Does your name match the name on your social security card? If not, to ensure you get credit for your earnings, contact SSA at 800-772-1213 or go to www.ssa.gov.

1. Address(Required)

1. City or town, state, and ZIP code(Required)

1C.(Required)

Single or Married filing separately

Married filing jointly or Qualifying widow(er)

Head of household (Check only if you’re unmarried and pay more than half the costs of keeping up a home for yourself and a qualifying individual.)

Complete Steps 2–4 ONLY if they apply to you; otherwise, skip to Step 5. See page 2 for more information on each step, who can claim exemption from withholding, when to use the estimator at www.irs.gov/W4App, and privacy.

Step 2: Multiple Jobs or Spouse Works

Complete this step if you (1) hold more than one job at a time, or (2) are married filing jointly and your spouse also works. The correct amount of withholding depends on income earned from all of these jobs.

Do only one of the following.

(a) Use the estimator at www.irs.gov/W4App for most accurate withholding for this step (and Steps 3–4); or
(b) Use the Multiple Jobs Worksheet on page 3 and enter the result in Step 4(c) below for roughly accurate withholding; or
(c) If there are only two jobs total, you may check this box. Do the same on Form W-4 for the other job. This option is accurate for jobs with similar pay; otherwise, more tax than necessary may be withheld.

TIP: To be accurate, submit a 2022 Form W-4 for all other jobs. If you (or your spouse) have self-employment income, including as an independent contractor, use the estimator.
Complete Steps 3–4(b) on Form W-4 for only ONE of these jobs. Leave those steps blank for the other jobs. (Your withholding will be most accurate if you complete Steps 3–4(b) on the Form W-4 for the highest paying job.)

Complete Steps 3–4(b) on Form W-4 for only ONE of these jobs. Leave those steps blank for the other jobs. (Your withholding will be most accurate if you complete Steps 3–4(b) on the Form W-4 for the highest paying job.)

Step 3: Claim Dependents

If your total income will be $200,000 or less ($400,000 or less if married filing jointly):

3. Multiply the number of qualifying children under age 17 by $2,000

3. Multiply the number of other dependents by $500

3. Add the amounts above and enter the total here

Step 4 (optional): Other Adjustments

4A. Other income (not from jobs).

If you want tax withheld for other income you expect this year that won't have withholding, enter the amount of other income here. This may include interest, dividends, and retirement income.

4B. Deductions.

If you expect to claim deductions other than the standard deduction and want to reduce your withholding, use the Deductions Worksheet on page 3 and enter the result here.

4C. Extra withholding.

Enter any additional tax you want withheld each pay period.

Step 5: Sign Here

Under penalties of perjury, I declare that this certificate, to the best of my knowledge and belief, is true, correct, and complete.

Employee’s signature(Required)

(This form is not valid unless you sign it.)

Date(Required)

Are you an Employer?(Required)

Yes

Employers Only

Employer’s name and address

First date of employment

Employer identification number (EIN)

Form 8233 Exemption from Withholding Based on Tax Treaty Benefits

As discussed in the FAQ section of this packet, you may only be exempt from federal income tax withholding if you qualify for tax treaty benefits. Please be advised that if you are in United States territory and territorial waters for more than 183 days (for most countries with tax treaties, but not all) during the year you will not receive tax treaty benefits and the law will require the employer to withhold tax for all days spent inside the United States territory and territorial waters.

***Regarding the tax treaties with the Philippines & Jamaica – the number of untaxed days in the US or US territorial waters are not to exceed 89***

If you are claiming tax treaty benefits and at any time during the year you later find out that you will be in the United States for more than 183 days, it is your responsibility to notify us immediately so we may begin withholding federal income tax.

In order to claim tax treaty benefits, the attached form must be completed and signed. By signing this form, you are attesting to the truthfulness of your claim.

If you have any questions when completing this form, please contact us directly.

Some countries DO NOT have a tax treaty with the United States. If you are from one of these countries, you cannot fill out the attached form or declare tax treaty benefits and we will be required to withhold US federal withholding tax from your pay whenever you are in US territory or territorial waters.

Some examples of countries that DO NOT have a tax treaty with the US are:

Bahamas

Croatia

Monaco

All Central American countries except Mexico

All South American countries except Venezuela

Most of the African continent except: Egypt, South Africa, and Tunisia

This is not a complete list, only various countries that we have had experience with that do not have tax treaties with the US. If you are unsure if your home country has a tax treaty with the United States, please contact our office.

This list will continue to be updated.

This exemption is applicable

for compensation for calendar year

OR other tax year beginning

AND ending

Part I - Identification of Beneficial Owner (see instructions.)

1. Name of individual(Required)

who is the beneficial owner

2. U.S. taxpayer identification number(Required)

3. Foreign tax identification number(Required)

if any

4. Permanent residence address (street, apt. or suite no., or rural route). Do not use a P.O. box.(Required)

City or town, state or province. Include postal code where appropriate.(Required)

Country (do not abbreviate)(Required)

5. Address in the United States (street, apt. or suite no., or rural route). Do not use a P.O. box.(Required)

City or town, state, and ZIP code(Required)

Note: Citizens of Canada or Mexico are not required to complete lines 7a and 7b.

6. U.S. visa type

7a. Country issuing passport

7b. Passport number

8. Date of entry

into the United States

9a. Current nonimmigrant status

9b. Date your current nonimmigrant status expires

10 If you are a foreign student, trainee, professor/teacher, or researcher

check this box

Caution: See the line 10 instructions for the required additional statement you must attach.

Part II - Claim for Tax Treaty Withholding Exemption

11. Compensation for independent (and certain dependent) personal services:

a. Description of personal services you are providing

b. Total compensation you expect to be paid for these services in this calendar or tax year

12. If compensation is exempt from withholding based on a tax treaty benefit, provide:

a. Tax treaty on which you are basing exemption from withholding

b. Treaty article on which you are basing exemption from withholding

c. Total compensation listed on line 11b above that is exempt from tax under this treaty $

d. Country of residence(Required)

13. Noncompensatory scholarship or fellowship income:

Note: Do not complete lines 13a through 13d unless you also received compensation for personal services from the same withholding agent.

a. Amount $

b. Tax treaty on which you are basing exemption from withholding

c. Treaty article on which you are basing exemption from withholding

d. Total income listed on line 13a above that is exempt from tax under this treaty $

14. Sufficient facts to justify the exemption from withholding claimed on line 12 and/or line 13 (see instructions)

Part III - Certification

Under penalties of perjury, I declare that I have examined the information on this form and to the best of my knowledge and belief it is true, correct, and complete. I further certify under penalties of perjury that:

I am the beneficial owner (or am authorized to sign for the beneficial owner) of all the income to which this form relates.
The beneficial owner is not a U.S. person.
The beneficial owner is a resident of the treaty country listed on line 12a and/or 13b above within the meaning of the income tax treaty between the United States and that country, or was a resident of the treaty country listed on line 12a and/or 13b above at the time of, or immediately prior to, entry into the United States, as required by the treaty.

Furthermore, I authorize this form to be provided to any withholding agent that has control, receipt, or custody of the income of which I am the beneficial owner or any withholding agent that can disburse or make payments of the income of which I am the beneficial owner.

Signature of beneficial owner(Required)

(or individual authorized to sign for beneficial owner)

Date(Required)

Part IV - Withholding Agent Acceptance and Certification

Name

Employer identification number

Address (number and street) (Include apt. or suite no. or P.O. box, if applicable.)

City, state, and ZIP code

Telephone number

Under penalties of perjury, I certify that I have examined this form and any accompanying statements, that I am satisfied that an exemption from withholding is warranted, and that I do not know or have reason to know that the nonresident alien individual is not entitled to the exemption or that the nonresident alien’s eligibility for the exemption cannot be readily determined.

Signature of withholding agent

Date

Name

This field is for validation purposes and should be left unchanged.