Reporting income paid to a non-US citizen working in a foreign location.

Hi there, @SusanG3. 

Thanks for visiting the Community. I appreciate you for being so detailed with your concern. 
 

If you hired an employee that isn’t a U.S. citizen (known as a Nonresident Alien or NRA by the IRS), they may be exempt from some payroll taxes. The taxes from which they are exempt vary depending on the type of visa they hold.

To help verify the best course of action for your business and to check what form you need to file for the situation that you're in, I suggest getting in touch with the IRS. They'll be able to provide you the guidelines when filing your recommended forms.

For future reference, here are some of our related articles about exempting NRA for federal income tax withholding:

• Set up Nonresident Alien (NRA) tax withholding for foreign employee
• Exemption status of foreign employees with particular visa types

As always, you can visit me here if you have any other questions. I'll be around to get you taken care of.