There are several exceptions to the 30% withholding requirement that may apply to foreign artists in certain circumstances. The exceptions to withholding which are relevant to the circumstances common to foreign artists are as follows:

• Compensation that is exempt from U.S. income tax by reason of a tax treaty;



• Compensation that is exempt from U.S. income tax because it is earned by an organization that is tax-exempt in its home country;



• The foreign artist enters into a Central Withholding Agreement with the Internal Revenue Service; and



• Compensation that is subject to withholding under Section 3402 ("graduated withholding") and the regulations under that section (this applies only if there is an employee/employer relationship).