IRS Notice 1392 – In today’s global workforce, nonresident aliens working in the United States often face unique tax withholding challenges. IRS Notice 1392 provides essential guidance to ensure accurate federal income tax withholding on wages and other compensation. This supplemental document modifies the standard instructions for Form W-4, Employee’s Withholding Certificate, specifically for nonresident aliens. Whether you’re an international employee, student, or business apprentice, understanding these rules can help avoid under- or over-withholding and potential tax issues when filing your return.
Published by the Internal Revenue Service (IRS), Notice 1392 was last revised in January 2020 and remains a key resource for nonresident aliens as of 2026. It addresses restrictions on filing status, deductions, and credits that differ from those available to U.S. residents. In this SEO-optimized guide, we’ll break down the notice’s key elements, using trusted sources like the official IRS website and related publications. For the full document, you can download the PDF directly from the IRS: https://www.irs.gov/pub/irs-pdf/n1392.pdf.
What Is IRS Notice 1392 and Why Does It Matter?
IRS Notice 1392, titled “Supplemental Form W-4 Instructions for Nonresident Aliens,” is designed to help nonresident aliens complete Form W-4 correctly so employers can withhold the appropriate amount of federal income tax. Nonresident aliens are individuals who are not U.S. citizens and do not meet the criteria for resident alien status under the green card test or substantial presence test. This includes many international workers, scholars, and others performing services in the U.S.
The notice modifies Form W-4 instructions to account for:
- Limited filing status options (only “Single or Married filing separately”).
- Inability to claim the standard deduction in most cases.
- Restrictions on tax credits and deductions.
Without following these guidelines, nonresident aliens might experience incorrect withholding, leading to surprises during tax season. For instance, employers use withholding tables that assume standard deduction benefits, so additional adjustments are often needed. This is crucial for compliance, as nonresident aliens generally file Form 1040-NR (U.S. Nonresident Alien Income Tax Return) to report income and claim refunds.
Who Does IRS Notice 1392 Apply To?
This notice primarily targets nonresident aliens receiving compensation for dependent personal services performed in the U.S., such as:
- Wages, salaries, bonuses, and commissions.
- Compensatory scholarships or fellowships representing payment for services.
It applies to alien individuals who:
- Do not qualify as resident aliens via the green card or substantial presence tests.
- Are treated as nonresident aliens under tie-breaker rules in a U.S. income tax treaty (for dual-residents).
Exceptions include certain exempt compensations, like payments to foreign agricultural workers on H-2A visas or crew members of foreign vessels. If you’re a resident of Canada, Mexico, or other specified countries, additional rules may apply—consult IRS Publication 519 for details.
Step-by-Step Instructions for Completing Form W-4 as a Nonresident Alien
Nonresident aliens must use the modified instructions in Notice 1392 when filling out Form W-4. Here’s a breakdown:
Step 1: Personal Information
- Enter your Social Security Number (SSN) in Step 1(b). If ineligible for an SSN, contact the Social Security Administration—do not use an Individual Taxpayer Identification Number (ITIN).
- In Step 1(c), check “Single or Married filing separately,” even if you’re married. Nonresident aliens cannot file jointly.
Step 2: Multiple Jobs or Spouse Works
- Skip this if you have only one job.
- If applicable, use the Multiple Jobs Worksheet or Two-Earners/Multiple Jobs Worksheet, but do not account for a spouse’s job.
- For the highest-paying job, write “Nonresident Alien” or “NRA” below Step 4(c) if using the estimator. Avoid the online Tax Withholding Estimator, as it’s not tailored for nonresidents.
Step 3: Claim Dependents
- Only claim if you’re from Canada, Mexico, South Korea, or India and eligible for the Child Tax Credit or Credit for Other Dependents.
- Nonresident aliens are generally not entitled to education credits.
Step 4: Other Adjustments
- Step 4(a): Enter other income not subject to withholding (e.g., interest or dividends).
- Step 4(b): Use the Deductions Worksheet for itemized deductions or adjustments like student loan interest, which may be limited.
- Step 4(c): Enter any additional amount to withhold per pay period. Write “Nonresident Alien” or “NRA” above this line to adjust for the lack of standard deduction.
- Do not claim exemption from withholding here, even if you meet certain conditions.
For multiple employers, complete Steps 3-4(b) only on the Form W-4 for your highest-paying job.
Adjustments for Withholding Allowances and Additional Amounts
Nonresident aliens cannot claim the standard deduction, so employers must withhold extra amounts as outlined in IRS Publication 15-T. However, students or business apprentices from India may qualify for a standard deduction under the U.S.-India tax treaty (Article 21(2))—no additional withholding applies in these cases.
To increase withholding:
- Use Step 4(c) on Form W-4 to specify an extra dollar amount per paycheck.
- This helps align with your actual tax liability, considering limited deductions and credits.
Treaty Benefits, Exemptions, and Special Rules
If eligible for withholding exemptions under a U.S. income tax treaty, do not submit Form W-4—instead, use Form 8233 to claim the benefit. This may exempt part or all of your compensation, but your employer might still withhold if details aren’t clear until year-end. In such cases, file Form 1040-NR to recover overwithheld taxes.
Other exemptions include:
- Up to $3,000 in pay from foreign employers if present in the U.S. for 90 days or less.
- Transportation-related employment for Canadian or Mexican residents.
- Payments to residents of U.S. possessions like Puerto Rico.
Refer to IRS Publication 901 for treaty details and Publication 519 for alien tax rules.
Important Notes and Updates for 2026
As of February 2026, Notice 1392 remains relevant, with no major revisions noted since 2020. Nonresident aliens should file a new Form W-4 when starting a job or if circumstances change (e.g., marital status or additional income). Always consult a tax professional or the IRS for personalized advice, as withholding differs significantly from U.S. resident rules.
Bona fide residents of U.S. possessions should check Publication 570 for specific withholding guidance. Remember, accurate withholding helps minimize tax owed or maximize refunds when filing Form 1040-NR.
For more resources, visit the IRS website or download Notice 1392 directly. If you’re a nonresident alien navigating Form W-4, staying informed ensures compliance and peace of mind.