Section 1441 requires withholding agents to withhold tax on payments made to the nonresident aliens for U.S. tax purposes. As a withholding agent, University of Massachusetts is liable for any tax required to be withheld. This liability is independent of the tax liability of the foreign person to whom the payment is made. Section 1461 states that if a withholding agent fails to withhold and the foreign payee fails to satisfy its U.S. tax liability, then both the withholding agent and the foreign person are liable for tax, as well as interest and any applicable penalties.
In most cases, a foreign person is subject to U.S. tax on its U.S. source income. Most types of U.S. source income received by a foreign person are subject to U.S. tax of 30%. UMass Employees who receive dependent compensation (wages/salary) are subject to graduated withholding, with some restrictions. A reduced rate, including exemption, may apply if there is a tax treaty between the foreign person's country of residence and the United States. The tax is generally withheld from the payment made to the foreign person.
Please see IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities to get an idea of how your income will be withheld by UMass.