Nonresident Alien Death Beneficiaries

Submitted by Anonymous on Tue, 2012-02-28 14:30

TIRA death beneficiaries are nonresident aliens (Mexican citizens) without US Social Security Numbers

Will distributions be subject to 30% US income tax withholding?

If it’s a qualifying Roth IRA will there be any mandatory US withholding?

Any other practical issues anybody has experienced?

Thanks

Permalink Submitted by Jose Morales on Tue, 2012-02-28 16:42

You would look up the withholding tax rate from the tax treaty table on publication 515, which can be found here: http://www.irs.gov/pub/irs-pdf/p515.pdf

They will have to apply for an ITIN, however the tax treaty rate for payments from pensions and annuities appears to be 0%.