Non-resident alien investors who are not considered U.S. tax residents generally do not pay federal capital gains tax on the sale of standard U.S. corporate stocks or exchange-traded funds, provided they do not spend a significant amount of time physically residing inside the United States. However, non-resident foreign investors are typically subject to a mandatory 30 percent statutory withholding tax on U.S.-sourced cash dividend distributions, which can sometimes be reduced through applicable bilateral tax treaties.