In December 1985, a tax treaty was finalized which exempted residents of Italy from the nonresident alien tax withholding.

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  The exemption was effective for benefits paid after January 31, 1986.

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  Late in May 1986, the beneficiaries were notified of the tax rate change and refund due.

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  The taxes erroneously withheld were refunded in a separate check early in June.

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  The change appeared in the July 3, 1986 check.

The tax treaty is effective for benefits paid on or after February 1, 1986, for months after November 1983.