In December 1997, a tax treaty with Switzerland was finalized. The terms of this treaty reduced, from 25.5 percent to 15 percent, the nonresident alien tax withheld from the benefits paid to residents of Switzerland.

• •

  The reduction was effective for benefits paid after January 31, 1998.

• •

  In April 1998, each beneficiary was notified of the tax treaty and its effect.

• •

  The change appeared in the payment dated May 3, 1998.

• •

  SSA refunded any taxes of more than 15 percent withheld from payments made after January 31, 1998.

The tax treaty is effective for benefits paid on or after February 1, 1998, for months after November 1983.

Alien residents of Switzerland are given an alien withholding status code (AWSC) of “5” (i.e, tax withholding, nonresident alien) because an AWSC of “2” (no withholding, resident of tax treaty country) would result in zero withholding.