Clusters of neurons generate electrical signals which propagate in all directions through brain tissue, skull, and scalp of different conductivity. Measuring these signals with electroencephalography (EEG) sensors placed on the scalp results in noisy data. This can have severe impact on estimation, such as, source localization and temporal response functions (TRFs). We hypothesize that some of the noise is due to a Wiener-structured signal propagation with both linear and nonlinear components. We have developed a simple nonlinearity detection and compensation method for EEG data analysis and utilize a model for estimating source-level (SL) TRFs for evaluation. Our results indicate that the nonlinearity compensation method produce more precise and synchronized SL TRFs compared to the original EEG data.