Free IRS 1042-S Form in PDF

Free IRS 1042-S Form in PDF

The IRS 1042-S form is a tax document used to report income paid to a non-resident, including individuals, corporations, and partnerships. This form plays a crucial role in ensuring compliance with the U.S. tax laws regarding foreign entities. For a detailed guide on how to fill out this form, click the button below.

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The intricacies of tax regulations in the United States can often seem daunting, especially when it involves reporting income from sources within the U.S. paid to foreign persons. This is where the IRS 1042-S form comes into the picture, serving as a critical document not just for individuals but also for entities navigating through the complexities of U.S. tax obligations on foreign income. The form is a cornerstone for both withholding agents and recipients, ensuring compliance with tax laws and facilitating accurate reporting of various types of income, from scholarships to royalties, that non-U.S. persons receive. Through the 1042-S form, detailed information regarding the income type, the amount subject to tax, and any applicable treaty benefits are meticulously recorded, significantly impacting tax liability assessments. Moreover, it plays a pivotal role in the broader scope of international tax obligations, linking withholding tax rates to the vast network of tax treaties the United States has with other countries, underscoring the necessity for meticulous attention to its completion and submission. Recognizing the major components and functions of the 1042-S form is essential for anyone involved in the payment process to non-U.S. persons, providing a clear framework for meeting U.S. tax reporting and withholding requirements.

Preview - IRS 1042-S Form

Form 1042-S
2026
Foreign Person’s U.S. Source Income Subject to Withholding
Department of the Treasury
Internal Revenue Service
Go to www.irs.gov/Form1042S for instructions and the latest information.
OMB No. 1545-0096
Copy A for
Internal Revenue Service
UNIQUE FORM IDENTIFIER
AMENDED
AMENDMENT NO.
1 Income
code
2 Gross income
3 Chapter indicator. Enter “3” or “4”
3a Exemption code
3b Tax rate .
4a
Exemption code
4b Tax rate .
5 Withholding allowance
6 Net income
7a Federal tax withheld
7b Check if federal tax withheld was not deposited with the IRS because
escrow procedures were applied (see instructions) . . . . . .
7c Check if withholding occurred in subsequent year with respect to a
partnership interest . . . . . . . . . . . . . .
7d Check if you are a qualified intermediary, withholding foreign
partnership, or withholding foreign trust revising its reporting on Form
1042-S to report to a specific recipient . . . . . . . . .
8 Tax withheld by other agents
9 Overwithheld tax repaid to recipient pursuant
to adjustment procedures (see instructions)
( )
10 Total withholding credit
(combine boxes 7a, 8, and 9)
11 Tax paid by withholding agent (amounts not withheld) (see instructions)
12a Withholding agent
’
s EIN
12b Ch. 3 status code
12c Ch. 4 status code
12d Withholding agent’s name
12e Withholding agent’s global intermediary identification number (GIIN)
12f Country code 12g FTIN, if any
12h Address (number and street)
12i Room or suite no. 12j City or town
12k State or province 12l Country 12m ZIP or foreign postal code
13a Recipient’s name 13b Recipient’s country code
13c Address (number and street)
13d Apt. no. 13e City or town
13f State or province 13g Country 13h ZIP or foreign postal code
13i Recipient’s U.S. TIN, if any
13j Ch. 3 status code
13k Ch. 4 status code
13l Recipient’s GIIN 13m Recipient’s FTIN, if any
13n LOB code 13o Recipient’s account number
13p Recipient’s date of birth (YYYYMMDD)
14a Primary withholding agent’s name (if applicable)
14b Primary withholding agent’s EIN
15
Check if pro-rata basis reporting
15a Intermediary or flow-through entity’s
EIN, if any
15b Ch. 3 status code
15c Ch. 4 status code
15d Intermediary or flow-through entity’s name
15e
Intermediary or flow-through entity’s GIIN
15f Country code 15g FTIN, if any
15h Address (number and street)
15i Room or suite no. 15j City or town
15k State or province 15l Country 15m ZIP or foreign postal code
16a Payer’s name 16b Payer’s TIN
16c Payer’s GIIN
16d Ch. 3 status code
16e Ch. 4 status code
17a State income tax withheld 17b
Payer’s state tax no.
17c Name of state
For Privacy Act and Paperwork Reduction Act Notice, see instructions.
Cat. No. 11386R
Form 1042-S (2026) Created 8/29/25
Form 1042-S
2026
Foreign Person’s U.S. Source Income Subject to Withholding
Department of the Treasury
Internal Revenue Service
Go to www.irs.gov/Form1042S for instructions and the latest information.
OMB No. 1545-0096
Copy B
for Recipient
UNIQUE FORM IDENTIFIER
AMENDED
AMENDMENT NO.
1 Income
code
2 Gross income
3 Chapter indicator. Enter “3” or “4”
3a Exemption code
3b Tax rate .
4a
Exemption code
4b Tax rate .
5 Withholding allowance
6 Net income
7a Federal tax withheld
7b Check if federal tax withheld was not deposited with the IRS because
escrow procedures were applied (see instructions) . . . . . .
7c Check if withholding occurred in subsequent year with respect to a
partnership interest . . . . . . . . . . . . . .
7d Check if you are a qualified intermediary, withholding foreign
partnership, or withholding foreign trust revising its reporting on Form
1042-S to report to a specific recipient . . . . . . . . .
8 Tax withheld by other agents
9 Overwithheld tax repaid to recipient pursuant
to adjustment procedures (see instructions)
( )
10 Total withholding credit
(combine boxes 7a, 8, and 9)
11 Tax paid by withholding agent (amounts not withheld) (see instructions)
12a Withholding agent
’
s EIN
12b Ch. 3 status code
12c Ch. 4 status code
12d Withholding agent’s name
12e Withholding agent’s global intermediary identification number (GIIN)
12f Country code 12g FTIN, if any
12h Address (number and street)
12i Room or suite no. 12j City or town
12k State or province 12l Country 12m ZIP or foreign postal code
13a Recipient’s name 13b Recipient’s country code
13c Address (number and street)
13d Apt. no. 13e City or town
13f State or province 13g Country 13h ZIP or foreign postal code
13i Recipient’s U.S. TIN, if any
13j Ch. 3 status code
13k Ch. 4 status code
13l Recipient’s GIIN 13m Recipient’s FTIN, if any
13n LOB code 13o Recipient’s account number
13p Recipient’s date of birth (YYYYMMDD)
14a Primary withholding agent’s name (if applicable)
14b Primary withholding agent’s EIN
15
Check if pro-rata basis reporting
15a Intermediary or flow-through entity’s
EIN, if any
15b Ch. 3 status code
15c Ch. 4 status code
15d Intermediary or flow-through entity’s name
15e
Intermediary or flow-through entity’s GIIN
15f Country code 15g FTIN, if any
15h Address (number and street)
15i Room or suite no. 15j City or town
15k State or province 15l Country 15m ZIP or foreign postal code
16a Payer’s name 16b Payer’s TIN
16c Payer’s GIIN
16d Ch. 3 status code
16e Ch. 4 status code
17a State income tax withheld 17b
Payer’s state tax no.
17c Name of state
(keep for your records)
Form 1042-S (2026)
U.S. Income Tax Filing Requirements
Generally, every nonresident alien individual, nonresident alien
fiduciary, and foreign corporation with U.S. income, including income
that is effectively connected with the conduct of a trade or business in
the United States, must file a U.S. income tax return. However, a
return is generally not required to be filed by a nonresident alien
individual, nonresident alien fiduciary, or foreign corporation if such
person was not engaged in a trade or business in the United States at
any time during the tax year and if the tax liability of such person was
fully satisfied by the withholding of U.S. tax at the source. See the
instructions for Forms 1120-F and 1040-NR for more information.
Corporations file Form 1120-F; all others file Form 1040-NR. You may
get the return forms and instructions at IRS.gov, at any U.S. Embassy
or consulate, or by writing to: Internal Revenue Service, 1201 N.
Mitsubishi Motorway, Bloomington, IL 61705-6613.
En règle générale, toute personne physique étrangère non
résidente, tout fiduciaire étranger non résident et toute société
étrangère ayant des revenus américains, y compris des revenus
effectivement liés à la conduite d’un commerce ou d’une entreprise
aux États-Unis, doit déposer une déclaration d’impôt sur le revenu
aux États-Unis. Toutefois, une déclaration n’est généralement pas
requise de la part d’un particulier étranger non résident, d’un
fiduciaire étranger non résident ou d’une société étrangère si cette
personne n’a pas exercé d’activité commerciale aux États-Unis à un
moment quelconque de l’année fiscale et si l’obligation fiscale de
cette personne a été entièrement satisfaite par la retenue à la source
de l’impôt américain. Voir les instructions des formulaires 1120F et
1040NR pour plus d’informations. Les sociétés déposent le formulaire
1120-F; toutes les autres déposent le formulaire 1040-NR. Vous
pouvez obtenir les formulaires de déclaration et les instructions sur le
site IRS.gov, dans n’importe quel bureau de poste des États-Unis, ou
en écrivant à l’ambassade ou au consulat de l’Union européenne:
Internal Revenue Service, 1201 N. Mitsubishi Motorway, Bloomington,
IL 61705-6613.
Por lo general, toda persona que es un extranjero no residente,
todo fiduciario extranjero no residente, y toda sociedad anónima
extranjera que perciba ingresos estadounidenses, inclusive de los
ingresos que son efectivamente conectados con la operación de un
comercio o negocio ubicado en los Estados Unidos, debe presentar
una declaración del impuesto estadounidense sobre los ingresos. Sin
embargo, por lo general no se requiere que un individuo extranjero no
residente, una sociedad anónima extranjera u organismo
fideicomisario extranjero no residente presenten una declaración si
dicha persona no participaba en ningún comercio o negocio ubicado
en los Estados Unidos en ningún momento durante el año tributario, y
la responsabilidad tributaria de dicha persona fuera liquidada
completamente mediante la retención del impuesto estadounidense
en la fuente del ingreso. Consulte las instrucciones de los Formularios
1120F y 1040-NR para obtener más información. Las sociedades
anónimas presentan el Formulario 1120-F, todos los demás presentan
el Formulario 1040-NR. Puede obtener los formularios de declaración
y sus instrucciones en IRS.gov, en cualquier embajada o consulado
de los Estados Unidos, o al escribir al: Internal Revenue Service, 1201
N. Mitsubishi Motorway, Bloomington, IL 61705-6613.
Grundsätzlich muss jede natürliche Person ohne Wohnsitz im Land,
jeder Treuhänder ohne Wohnsitz im Land und jede ausländische
Gesellschaft mit Einkünften in den USA, einschließlich Einkünften, die
tatsächlich mit der Ausübung einer gewerblichen oder geschäftlichen
Tätigkeit in den Vereinigten Staaten in Zusammenhang stehen, eine
US-Einkommensteuererklärung einreichen. Eine Steuererklärung muss
jedoch von einem nicht in den USA ansässigen Ausländer, einem nicht
in den USA ansässigen Treuhänder oder einem ausländischen
Unternehmen im Allgemeinen nicht eingereicht werden, wenn diese
Person zu keinem Zeitpunkt während des Steuerjahres in den
Vereinigten Staaten einer gewerblichen oder geschäftlichen Tätigkeit
nachgegangen ist und die Steuerschuld dieser Person durch den
Einbehalt der US-Quellensteuer vollständig beglichen wurde. Weitere
Informationen finden Sie in den Anweisungen für die Formulare 1120F
und 1040NR. Unternehmen reichen das Formular 1120-F ein, alle
anderen reichen das Formular 1040-NR ein. Sie können die
Rücksendeformulare und Anweisungen auf IRS.gov erhalten, auf jeder
US-Botschaft oder Konsulat oder schriftlich an: Internal Revenue
Service, 1201 N. Mitsubishi Motorway, Bloomington, IL 61705-6613.
Explanation of Codes
Box 1. Income Code.
Code Types of Income
Interest
01 Interest paid by U.S. obligors—general
02 Interest paid on real property mortgages
03 Interest paid to controlling foreign corporations
04 Interest paid by foreign corporations
05 Interest on tax-free covenant bonds
22 Interest paid on deposit with a foreign branch of a domestic
corporation or partnership
29 Deposit interest
30 Original issue discount (OID)
31 Short-term OID
33 Substitute payment—interest
51 Interest paid on certain actively traded or publicly offered
securities
1
54 Substitute payments—interest from certain actively traded
or publicly offered securities
1
Dividend
06 Dividends paid by U.S. corporations—general
07 Dividends qualifying for direct dividend rate
08 Dividends paid by foreign corporations
Dividend
34 Substitute payment—dividends
40 Other dividend equivalents under IRC section 871(m)
52
Dividends paid on certain actively traded or publicly offered
securities
1
53
Substitute payments—dividends from certain actively traded
or publicly offered securities
1
56
Dividend equivalents under IRC section 871(m) as a result of
applying the combined transaction rules
Other
09 Capital gains
10 Industrial royalties
11 Motion picture or television copyright royalties
12 Other royalties (for example, copyright, software,
broadcasting, endorsement payments)
13 Royalties paid on certain publicly offered securities
1
14 Real property income and natural resources royalties
15 Pensions, annuities, alimony, and/or insurance premiums
16 Scholarship or fellowship grants
17 Compensation for independent personal services
2
18 Compensation for dependent personal services
2
19 Compensation for teaching
2
See back of Copy C for additional codes
1
This code should only be used if the income paid is described in Regulations section 1.1441-6(c)(2) and the withholding agent has reduced the rate of withholding
under an income tax treaty without the recipient providing a U.S. TIN or an FTIN.
2
If compensation that would otherwise be covered under Income Codes 17 through 20 is directly attributable to the recipient’s occupation as an artist or athlete, use
Income Code 42 or 43 instead.
Form 1042-S
2026
Foreign Person’s U.S. Source Income Subject to Withholding
Department of the Treasury
Internal Revenue Service
Go to www.irs.gov/Form1042S for instructions and the latest information.
OMB No. 1545-0096
Copy C for Recipient
Attach to any federal tax return you file
UNIQUE FORM IDENTIFIER
AMENDED
AMENDMENT NO.
1 Income
code
2 Gross income
3 Chapter indicator. Enter “3” or “4”
3a Exemption code
3b Tax rate .
4a
Exemption code
4b Tax rate .
5 Withholding allowance
6 Net income
7a Federal tax withheld
7b Check if federal tax withheld was not deposited with the IRS because
escrow procedures were applied (see instructions) . . . . . .
7c Check if withholding occurred in subsequent year with respect to a
partnership interest . . . . . . . . . . . . . .
7d Check if you are a qualified intermediary, withholding foreign
partnership, or withholding foreign trust revising its reporting on Form
1042-S to report to a specific recipient . . . . . . . . .
8 Tax withheld by other agents
9 Overwithheld tax repaid to recipient pursuant
to adjustment procedures (see instructions)
( )
10 Total withholding credit
(combine boxes 7a, 8, and 9)
11 Tax paid by withholding agent (amounts not withheld) (see instructions)
12a Withholding agent
’
s EIN
12b Ch. 3 status code
12c Ch. 4 status code
12d Withholding agent’s name
12e Withholding agent’s global intermediary identification number (GIIN)
12f Country code 12g FTIN, if any
12h Address (number and street)
12i Room or suite no. 12j City or town
12k State or province 12l Country 12m ZIP or foreign postal code
13a Recipient’s name 13b Recipient’s country code
13c Address (number and street)
13d Apt. no. 13e City or town
13f State or province 13g Country 13h ZIP or foreign postal code
13i Recipient’s U.S. TIN, if any
13j Ch. 3 status code
13k Ch. 4 status code
13l Recipient’s GIIN 13m Recipient’s FTIN, if any
13n LOB code 13o Recipient’s account number
13p Recipient’s date of birth (YYYYMMDD)
14a Primary withholding agent’s name (if applicable)
14b Primary withholding agent’s EIN
15
Check if pro-rata basis reporting
15a Intermediary or flow-through entity’s
EIN, if any
15b Ch. 3 status code
15c Ch. 4 status code
15d Intermediary or flow-through entity’s name
15e
Intermediary or flow-through entity’s GIIN
15f Country code 15g FTIN, if any
15h Address (number and street)
15i Room or suite no. 15j City or town
15k State or province 15l Country 15m ZIP or foreign postal code
16a Payer’s name 16b Payer’s TIN
16c Payer’s GIIN
16d Ch. 3 status code
16e Ch. 4 status code
17a State income tax withheld 17b
Payer’s state tax no.
17c Name of state
Form 1042-S (2026)
Explanation of Codes (continued)
Other
20 Compensation during studying and training
2
23 Other income
24 Qualified investment entity (QIE) distributions of capital
gains
25 Trust distributions subject to IRC section 1445
26 Unsevered growing crops and timber distributions by a trust
subject to IRC section 1445
27 Publicly traded partnership distributions subject to IRC
section 1446(a)
28 Gambling winnings
3
32 Notional principal contract income
4
35 Substitute payment—other
36 Capital gains distributions
37 Return of capital
38
39 Distributions from a nongrantor trust subject to IRC section
877A(f)(1)
41 Guarantee of indebtedness
42 Earnings as an artist or athlete—no central withholding
agreement
5
43 Earnings as an artist or athlete—central withholding
agreement
5
44 Specified federal procurement payments
50 Income previously reported under escrow procedure
6
55 Taxable death benefits on life insurance contracts
57 Amount realized under IRC section 1446(f)
58 Publicly traded partnership distributions—undetermined
59 Consent fees
60 Loan syndication fees
61 Settlement payments
Eligible deferred compensation items subject to IRC section
877A(d)(1)
Box 3a. Exemption Code (applies if withholding is applied at a
reduced rate or if payment is exempt from withholding).
Code
Chapter 3 Authority for Exemption or Reduced Rate of
Withholding
01 Effectively connected income
02 Exempt or reduced withholding under IRC
7
03 Income is not from U.S. sources
04 Exempt or reduced withholding under tax treaty
05 Portfolio interest exempt under IRC
06 QI that assumes primary withholding responsibility
07 Withholding foreign partnership or withholding foreign trust
08 U.S. branch treated as U.S. person
10 QI represents that income is exempt
11 QSL that assumes primary withholding responsibility
12 Payee subjected to chapter 4 withholding
22 QDD that assumes primary withholding responsibility
23 Exempt under section 897(l)
24 Exempt under section 892
Box 4a. Exemption Code (applies if the tax rate entered in 4b
is 00.00).
Code
Chapter 4 Authority for Exemption
13 Grandfathered payment
14 Effectively connected income
15 Payee not subject to chapter 4 withholding
16 Excluded nonfinancial payment
17
Foreign entity that assumes primary withholding responsibility
18 U.S. payees of participating FFI or registered deemed-
compliant FFI
19 Exempt from withholding under IGA
8
20 Dormant account
9
21 Other payment not subject to chapter 4 withholding
Boxes 12b, 12c, 13f, 13g, 15b, 15c, 16d, and 16e. Withholding
Agent, Recipient, Intermediary, and Payer Chapter 3 and
Chapter 4 Status Codes.
Type of Recipient, Withholding Agent, Payer, or Intermediary
Code
Chapter 3 Status Codes
05 U.S. branch—treated as U.S. person
10
06 U.S. branch—not treated as U.S. person
11
07 U.S. branch—ECI presumption applied
08 Partnership other than withholding foreign partnership,
publicly traded partnership, or partnership QDD
09 Withholding foreign partnership
10 Trust other than withholding foreign trust
11 Withholding foreign trust
12 Qualified intermediary
13 Qualified securities lender—qualified intermediary
14 Qualified securities lender—other
15 Corporation
16 Individual
17 Estate
18 Private foundation
19 International organization
20 Tax Exempt organization (section 501(c) entities)
21 Unknown recipient
See back of Copy D for additional codes
2
If compensation that would otherwise be covered under Income Codes 17 through 20 is directly attributable to the recipient’s occupation as an artist or athlete, use
Income Code 42 or 43 instead.
3
Subject to 30% withholding rate unless the recipient is from one of the treaty countries listed under Gambling winnings (Income Code 28) in Pub. 515.
4
Use appropriate Interest Income Code for embedded interest in a notional principal contract.
5
Income Code 43 should only be used if Letter 4492, Venue Notification, has been issued by the Internal Revenue Service (otherwise, use Income Code 42 for earnings
as an artist or athlete). If Income Code 42 or 43 is used, Recipient Code 22 (artist or athlete) should be used instead of Recipient Code 16 (individual), 15 (corporation),
or 08 (partnership other than withholding foreign partnership, publicly traded partnership, or partnership QDD).
6
Use only to report gross income the tax for which is being deposited in the current year because such tax was previously escrowed for chapters 3 and 4 and the
withholding agent previously reported the gross income in a prior year and checked the box to report the tax as not deposited under the escrow procedure. See the
instructions to this form for further explanation.
7
This code should only be used if no other specific chapter 3 exemption code applies.
8
Use only to report a U.S. reportable account or nonconsenting U.S. account that is receiving a payment subject to chapter 3 withholding.
9
Use only if applying the escrow procedure for dormant accounts under Regulations section 1.1471-4(b)(6). If tax was withheld and deposited under chapter 3, do not
check box 7b (“tax not deposited with IRS pursuant to escrow procedure”). You must instead enter “3” in box 3 and complete box 3b.
10
This code can be used by a territory FI that is treated as a U.S. person.
11
This code can be used by a territory FI that is not treated as a U.S. person.
Form 1042-S
2026
Foreign Person’s U.S. Source Income Subject to Withholding
Department of the Treasury
Internal Revenue Service
Go to www.irs.gov/Form1042S for instructions and the latest information.
OMB No. 1545-0096
Copy D for Recipient
Attach to any state tax return you file
UNIQUE FORM IDENTIFIER
AMENDED
AMENDMENT NO.
1 Income
code
2 Gross income
3 Chapter indicator. Enter “3” or “4”
3a Exemption code
3b Tax rate .
4a
Exemption code
4b Tax rate .
5 Withholding allowance
6 Net income
7a Federal tax withheld
7b Check if federal tax withheld was not deposited with the IRS because
escrow procedures were applied (see instructions) . . . . . .
7c Check if withholding occurred in subsequent year with respect to a
partnership interest . . . . . . . . . . . . . .
7d Check if you are a qualified intermediary, withholding foreign
partnership, or withholding foreign trust revising its reporting on Form
1042-S to report to a specific recipient . . . . . . . . .
8 Tax withheld by other agents
9 Overwithheld tax repaid to recipient pursuant
to adjustment procedures (see instructions)
( )
10 Total withholding credit
(combine boxes 7a, 8, and 9)
11 Tax paid by withholding agent (amounts not withheld) (see instructions)
12a Withholding agent
’
s EIN
12b Ch. 3 status code
12c Ch. 4 status code
12d Withholding agent’s name
12e Withholding agent’s global intermediary identification number (GIIN)
12f Country code 12g FTIN, if any
12h Address (number and street)
12i Room or suite no. 12j City or town
12k State or province 12l Country 12m ZIP or foreign postal code
13a Recipient’s name 13b Recipient’s country code
13c Address (number and street)
13d Apt. no. 13e City or town
13f State or province 13g Country 13h ZIP or foreign postal code
13i Recipient’s U.S. TIN, if any
13j Ch. 3 status code
13k Ch. 4 status code
13l Recipient’s GIIN 13m Recipient’s FTIN, if any
13n LOB code 13o Recipient’s account number
13p Recipient’s date of birth (YYYYMMDD)
14a Primary withholding agent’s name (if applicable)
14b Primary withholding agent’s EIN
15
Check if pro-rata basis reporting
15a Intermediary or flow-through entity’s
EIN, if any
15b Ch. 3 status code
15c Ch. 4 status code
15d Intermediary or flow-through entity’s name
15e
Intermediary or flow-through entity’s GIIN
15f Country code 15g FTIN, if any
15h Address (number and street)
15i Room or suite no. 15j City or town
15k State or province 15l Country 15m ZIP or foreign postal code
16a Payer’s name 16b Payer’s TIN
16c Payer’s GIIN
16d Ch. 3 status code
16e Ch. 4 status code
17a State income tax withheld 17b
Payer’s state tax no.
17c Name of state
Form 1042-S (2026)
Explanation of Codes (continued)
22 Artist or athlete
23 Pension
24 Foreign central bank of issue
25 Nonqualified intermediary
26 Hybrid entity making treaty claim
35 Qualified derivatives dealer
36 Foreign government—integral part
37 Foreign government—controlled entity
38 Publicly traded partnership
39 Disclosing qualified intermediary
40 Partnership QDD
12
41 U.S. government entity or tax exempt entity (other than
section 501(c) entities)
13
Pooled Reporting Codes
14
27 Withholding rate pool—general
28 Withholding rate pool—exempt organization
29 PAI withholding rate pool—general
30 PAI withholding rate pool—exempt organization
31 Agency withholding rate pool—general
32 Agency withholding rate pool—exempt organization
Chapter 4 Status Codes
01 U.S. withholding agent—FI
02 U.S. withholding agent—other
03 Territory FI—not treated as U.S. person
04 Territory FI—treated as U.S. person
05 Participating FFI—other
06 Participating FFI—reporting Model 2 FFI
07 Registered deemed-compliant FFI—reporting Model 1 FFI
08 Registered deemed-compliant FFI—sponsored entity
09 Registered deemed-compliant FFI—other
10 Certified deemed-compliant FFI—other
11 Certified deemed-compliant FFI—FFI with low value
accounts
12 Certified deemed-compliant FFI—nonregistering local bank
13 Certified deemed-compliant FFI—sponsored entity
14 Certified deemed-compliant FFI—investment entity that
does not maintain financial accounts
15 Nonparticipating FFI
16 Owner-documented FFI
17 U.S. branch—treated as U.S. person
18 U.S. branch—not treated as U.S. person (reporting under
section 1471)
19 Passive NFFE identifying substantial U.S. owners
20 Passive NFFE with no substantial U.S. owners
21 Publicly traded NFFE or affiliate of publicly traded NFFE
22 Active NFFE
23 Individual
24 Section 501(c) entities
25 Excepted territory NFFE
26 Excepted NFFE—other
27 Exempt beneficial owner
28 Entity wholly owned by exempt beneficial owners
29 Unknown recipient
30 Recalcitrant account holder
31 Nonreporting IGA FFI
32 Direct reporting NFFE
33 U.S. reportable account
34 Nonconsenting U.S. account
35 Sponsored direct reporting NFFE
36 Excepted inter-affiliate FFI
37 Undocumented preexisting obligation
38 U.S. branch—ECI presumption applied
39 Account holder of excluded financial account
15
40 Passive NFFE reported by FFI
16
41 NFFE subject to 1472 withholding
50 U.S. withholding agent—foreign branch of FI
Pooled Reporting Codes
42 Recalcitrant pool—no U.S. indicia
43 Recalcitrant pool—U.S. indicia
44 Recalcitrant pool—dormant account
45 Recalcitrant pool—U.S. persons
46 Recalcitrant pool—passive NFFEs
47 Nonparticipating FFI pool
48 U.S. payees pool
49 QI-recalcitrant pool—generaI
17
Box 13j. LOB Code (enter the code that best describes the
applicable limitation on benefits (LOB) category that qualifies the
taxpayer for the requested treaty benefits).
LOB Code LOB Treaty Category
02 Government—contracting state/political subdivision/local
authority
03 Tax exempt pension trust/pension fund
04 Tax exempt/charitable organization
05 Publicly traded corporation
06 Subsidiary of publicly traded corporation
07 Company that meets the ownership and base erosion test
08 Company that meets the derivative benefits test
09 Company with an item of income that meets the active trade
or business test
10 Discretionary determination
11 Other
12 No LOB article in treaty
12
Status code 40 should only be used for the partnership’s allocations to its partners with respect to its (or its branch’s) QDD’s activities. The partnership should report
all other allocations with respect to its partners using status code 8, 9, or 38, as applicable. When the partnership is transacting in its QDD capacity, it should use
status code 35.
13
This includes a college, a university, or another U.S. entity exempt from tax under an Internal Revenue Code section other than section 501(c). This code is only
applicable for reporting the chapter 3 status of a withholding agent (box 12b).
14
Codes 27 through 32 should only be used by a QI, QSL, WP, or WT. A QI acting as a QDD may use only code 27 or 28.
15
This code should only be used if income is paid to an account that is excluded from the definition of financial account under Regulations section 1.1471-5(b)(2) or
under Annex II of the applicable Model 1 IGA or Model 2 IGA.
16
This code should only be used when the withholding agent has received a certification on the FFI withholding statement of a participating FFI or registered deemed-
compliant FFI that maintains the account that the FFI has reported the account held by the passive NFFE as a U.S. account (or U.S. reportable account) under its
FATCA requirements. The withholding agent must report the name and GIIN of such FFI in boxes 15d and 15e.
17
This code should only be used by a withholding agent that is reporting a payment (or portion of a payment) made to a QI with respect to the QI’s recalcitrant account holders.
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Document Specs

Fact Name Description
Purpose The IRS 1042-S form is used to report amounts paid to foreign persons, including non-resident aliens, foreign corporations, and foreign partnerships, that are subject to income tax withholding.
Who Must File Any U.S. entity that pays a foreign person that requires reporting under the sections of 1441, 1442, 1443, or 1446 must file Form 1042-S.
Due Date The form must be filed with the IRS and a copy sent to the payee by March 15th of the year following the payment.
Variability by State While the IRS 1042-S form is a federal form and not subject to state-specific variations, the impact of payments reported may affect state tax obligations depending on the state's tax laws regarding foreign income.

Instructions on Writing IRS 1042-S

Filling out the IRS 1042-S form is an important process for reporting specified types of income. This form is essential for entities paying to foreign persons, including individuals, corporations, and partnerships. The following steps will guide you through completing this form correctly. After the form is filled out, it must be filed with the IRS, and copies should be distributed to the recipient of the income as well as any applicable state tax departments. This ensures compliance with U.S. tax laws and assists in the proper accounting of income for recipients.

  1. Start by gathering the necessary information, including the recipient's name, address, country of citizenship, tax identification number, and the details of the income paid.
  2. Enter the recipient's information in the relevant sections at the top of the form, such as their legal name, address, country of citizenship, and tax identification number.
  3. Choose the appropriate income code that matches the type of payment made to the foreign person. This code is crucial as it determines the tax treatment of the income.
  4. Fill in the gross income amount paid to the recipient during the tax year in the designated box. Ensure accuracy, as this information directly affects tax obligations.
  5. Report the withholding amount, if any, in the section provided. This includes any federal tax withheld in accordance with the IRS guidelines.
  6. Determine the exemption code, if applicable, and enter it in the form. Some payments may be exempt from withholding based on tax treaties or the nature of the payment.
  7. Sign and date the form, verifying that all the information provided is accurate and true to the best of your knowledge.
  8. Finally, distribute the necessary copies of the form as required: one to the IRS, one to the recipient of the income, and, if applicable, one to the state tax department.

After the form has been correctly filled out and distributed, the filer should retain a copy for their records. Timely and accurate filing of the IRS 1042-S form is crucial for ensuring compliance with tax regulations and for facilitating the proper tax treatment of foreign persons receiving income from U.S. sources. Should there be any questions or concerns during this process, seeking the advice of a tax professional is recommended to avoid any potential errors or omissions.

Understanding IRS 1042-S

What is a 1042-S form?

The 1042-S form is a tax document issued by the Internal Revenue Service (IRS) to report income paid to a foreign person that is subject to income tax withholding. This includes salaries, dividends, scholarships, royalties, and other types of income. It's a crucial form for non-U.S. residents who have received income from U.S. sources.

Who needs to file the 1042-S form?

Typically, the 1042-S form must be filed by the U.S. payer or withholding agent who has paid the foreign individual or entity. It is not generally the responsibility of the foreign person who received the income to file this form. However, the recipient does need the information provided on the form to complete their own tax obligations.

What types of income are reported on the 1042-S form?

The form covers a wide range of income types, such as wages, scholarships and fellowship grants, dividends, royalties, rents, commissions, and other fixed or determinable annual or periodic gains, profits, and income. Each type of income has specific reporting requirements.

How is the 1042-S form different from a W-2 or 1099 form?

A 1042-S form is specifically for reporting income paid to non-U.S. persons. In contrast, a W-2 form is used to report wages paid to employees and the taxes withheld from them who are U.S. residents, and a 1099 form reports various types of income to U.S. residents and entities other than salaries, such as independent contractor earnings, interest, and dividends.

When is the 1042-S form due?

The deadline to file the form with the IRS and to deliver a copy to the income recipient is March 15th of the year following the payment of the income. However, if the due date falls on a weekend or public holiday, the deadline is extended to the next business day.

Is electronic filing of the 1042-S form possible?

Yes, electronic filing of the 1042-S form is possible and even required for withholding agents submitting 250 or more forms. The IRS encourages electronic filing for efficiency and faster processing times.

Can amendments be made to a filed 1042-S form?

Yes, if errors are discovered on a submitted 1042-S form, it is important to correct the information as soon as possible. The withholding agent must file an amended 1042-S form, marking it as "Amended" with the corrected information.

What if I don’t receive a 1042-S form but should have?

If you expected to receive a 1042-S form and did not, contact the payer of the income to inquire about the form. The payer is responsible for issuing and delivering the 1042-S form to each recipient by the March 15th deadline.

Are there penalties for not filing the 1042-S form?

Yes, there can be significant penalties for failing to file the 1042-S form or for filing an incorrect or incomplete form. Penalties can include fines and interest on the unpaid taxes due. It's essential to file accurately and timely to avoid such penalties.

Where can I find more information on the 1042-S form and its filing requirements?

For detailed instructions and the latest updates on the 1042-S form, visiting the official Internal Revenue Service (IRS) website is recommended. The IRS provides resources, guides, and contact information for additional assistance.

Common mistakes

Filing taxes can often feel like navigating through a maze, especially when dealing with forms like the IRS 1042-S, which is used for reporting amounts paid to foreign persons, including non-resident aliens, foreign partnerships, and corporations. A small mistake on this form can lead to big headaches, ranging from delays in processing to potential penalties. Let's look at eight common mistakes to avoid.

One of the first missteps occurs when individuals provide incorrect taxpayer identification numbers (TINs). This error can lead to improper reporting and issues for both the payer and the recipient. It's crucial to double-check these numbers for accuracy before submission.

A frequently seen error is failing to accurately determine the recipient's status. This determination is essential because it dictates the tax withholding requirements. Misidentifying a recipient's status can result in under or over withholding of taxes, each bringing its own set of problems.

Another common pitfall is improperly characterizing the income type. The 1042-S form encompasses various income types, and each comes with its own tax implications. Accurately identifying the nature of the payment ensures the correct tax treatment is applied.

People often overlook the need to comply with the special rates and conditions that may apply under tax treaty benefits. When recipients are eligible for reduced rates or exemptions under a tax treaty, failing to apply these can lead to excessive withholding, impacting the recipient negatively.

An easy to make but critical mistake is entering incorrect information about the withholding agent. As the entity responsible for reporting and sometimes withholding tax, any inaccuracies here can delay processing and affect the accuracy of the information reported to the IRS and the payee.

Many also fail to report each recipient separately, a requirement that ensures clarity and accuracy in reporting. Bundling payments together can obscure the details of transactions, making it difficult for the IRS to verify that the appropriate amount of tax has been withheld and reported.

Another oversight is neglecting to provide all required forms. The 1042-S form may need to be filed alongside other documents, depending on the specifics of the transactions and the parties involved. Overlooking this detail can result in incomplete submissions, leading to potential processing delays or inquiries from the IRS.

Lastly, a significant but avoidable mistake is missing the filing deadline. This lapse can lead to penalties and interest charges, adding unnecessary costs. Ensuring that the form is filed on time, considering the submission method (electronic or paper), is fundamental to compliance.

Avoiding these errors requires meticulous attention to detail and a thorough understanding of the requirements. When in doubt, consulting with a tax professional can help navigate the complexities of the 1042-S form and avoid these common pitfalls.

Documents used along the form

Filing taxes in the United States involves various forms and documents, especially for those dealing with international matters. The IRS 1042-S form is a critical document for reporting income paid to a foreign person within the U.S. However, to ensure compliance and accuracy in reporting, several other documents often accompany the 1042-S form. Each of these documents serves a unique purpose, making understanding them essential for individuals and entities involved in international financial activities.

  • W-8BEN Form - This form is used by foreign individuals to certify their foreign status and claim any applicable benefits or exemptions from the U.S. tax withholding as per the tax treaties between their country and the U.S. It's a critical document for non-U.S. entities to reduce their tax obligations legally.
  • W-8BEN-E Form - Similar to the W-8BEN, this form is for entities rather than individuals. Foreign companies use it to claim special tax treaty benefits, including a reduced rate of withholding tax, pointing out their status as beneficial owners of the income they receive from the U.S.
  • 1042-T Form - This annual summary and transmittal form accompanies the 1042-S forms when they are physically mailed to the IRS. It serves as a cover page summarizing the total income and withholding reported on the 1042-S forms it covers.
  • W-9 Form - Request for Taxpayer Identification Number and Certification, used by U.S. persons (including resident aliens) to provide their Social Security Number (SSN) or Employer Identification Number (EIN) to the entity that is required to file an information return with the IRS. This may be necessary in transactions with foreign persons to determine if payments are subject to reporting on Form 1042-S.
  • 8805 Form - This form is relevant when foreign partners in a U.S. partnership are subject to income tax withholding at the partnership level. It reports the effectively connected income, and the tax withheld at the partnership level, ensuring partners are credited for this withholding.
  • 8233 Form - Nonresident aliens use this form to claim a tax treaty exemption from withholding on compensation for personal services performed in the United States. It's important for ensuring that income is taxed appropriately according to treaty terms, potentially reducing withholding obligations.
  • 8966 Form - The FATCA Report is used to comply with the Foreign Account Tax Compliance Act, requiring foreign financial institutions and certain other non-financial entities to report on foreign assets held by their U.S. account holders or face withholding on withholdable payments. It's a crucial document for international tax compliance.

Understanding and properly handling these forms is vital for maintaining compliance with U.S. tax laws, especially for those with international ties. Whether you're a foreign individual working in the U.S., a U.S. entity making payments to foreign persons, or involved in international financial transactions in any capacity, being knowledgeable about these documents can help navigate the complexities of international taxation and avoid potential pitfalls.

Similar forms

The IRS 1042-S form is closely related to various other tax documents, each serving specific purposes yet sharing common objectives concerning reporting and tax withholding for individuals and entities under certain circumstances. One such document is the W-2 form. The similarity between the 1042-S and the W-2 lies in their purpose of reporting income. However, while the 1042-S reports income paid to foreign persons, the W-2 is used to report wages, tips, and other compensation paid to employees based in the United States.

Another document akin to the 1042-S form is the 1099 series, particularly the 1099-MISC. Both forms are used for reporting payments made during the business or trade activities. While the 1099-MISC form is utilized for reporting payments made to independent contractors or freelancers within the U.S., the 1042-S form is for reporting various types of income, such as royalties, scholarships, or investment income paid to foreign individuals and entities.

The W-8BEN form also shares similarities with the 1042-S form. It is primarily used by foreign individuals to certify their non-U.S. status and claim any tax treaty benefits, including reduced rates or exemptions from withholding tax. In contrast, the 1042-S form is the document through which the income paid to these foreign individuals and any related withholding are reported. Essentially, the W-8BEN informs how the 1042-S form should be completed regarding the foreign individual’s income.

Form 1042, not to be confused with the 1042-S, is another document related to the 1042-S. Form 1042 acts as the annual tax return for income withheld from U.S. sources for foreign persons, summarizing all 1042-S forms issued by the withholding agent. It aggregates the total amount of U.S.-source income paid to foreign persons and the total tax withheld, serving as a comprehensive report to the IRS.

The W-9 form, used by entities and individuals within the United States to provide their taxpayer identification number, parallels the 1042-S form in that it helps determine the proper tax reporting status of the payee. However, the 1042-S is used in the context of foreign individuals, where the W-9 is domestic. Essentially, the W-9 helps to certify a payee’s tax status to avoid backup withholding, while the 1042-S reports on income paid to foreign entities or persons.

Finally, the Form 8833 is associated with the 1042-S form, as it is used by treaty-based positions. This form is employed by taxpayers who take advantage of treaties to reduce their tax liability. When a foreign person claims a reduced rate of, or exemption from, withholding as a result of a tax treaty, such a claim might be reported on a 1042-S. The Form 8833 is tied to this process, as it is required to be filed by those using treaty benefits that affect their taxation in the U.S.

In summary, while each of these documents serves distinct functions within the U.S. tax code, their interconnectedness with the 1042-S form highlights the complexity of tax reporting and withholding for foreign individuals and entities. Understanding each document's role provides clarity for properly managing international tax obligations and benefits.

Dos and Don'ts

When dealing with the IRS 1042-S form, which is used to report amounts paid to foreign persons, including non-resident aliens, foreign corporations, and foreign partnerships, careful attention to detail is crucial. The following lists provide guidance on what actions to take and what mistakes to avoid to ensure the process is completed correctly and efficiently.

Do:

  • Double-check the taxpayer identification number (TIN) provided. Providing accurate information is essential for reporting the earnings and withholdings associated with the right entity.
  • Report income in U.S. dollars, converting foreign currency amounts based on the exchange rate in effect on the day of payment. This ensures consistency and accuracy in reporting.
  • Include all necessary information for each recipient, such as the recipient's country of citizenship and the country of tax residence. This is important for determining the correct tax withholding rate under U.S. tax law and treaty agreements.
  • Make use of the official IRS instructions for filling out the 1042-S form. These guidelines are designed to help avoid common mistakes and clarify complex reporting requirements.
  • Ensure timely filing of the form with the IRS, adhering to the specified deadline, typically March 15, to avoid penalties.

Don't:

  • Overlook the need to provide detailed descriptions of each type of income paid. General or vague descriptions can lead to processing delays or requests for additional information.
  • Forget to report any exemptions or reductions in withholding based on tax treaty benefits. Failure to accurately report these details can result in over-withholding and unnecessary refund processes.
  • Mistakenly report payments that are not covered under the 1042-S form. Only specific types of payments to foreign persons should be reported, as outlined in IRS guidelines.
  • Disregard the requirement to file electronically if you are required to file 250 or more forms. Electronic filing facilitates faster processing and better accuracy.
  • Submit the form without reviewing all the information for accuracy and completeness. Errors or omissions can lead to penalties or delayed processing.

Misconceptions

The IRS Form 1042-S often involves complex international tax laws, leading to widespread misconceptions. It's crucial to understand these misconceptions to avoid common pitfalls and ensure compliance with tax regulations. Below are nine common misconceptions about the IRS 1042-S form, explained to shed light on the actual requirements and uses of the form.

  • Only applicable for payments made to individuals: A common misunderstanding is that Form 1042-S is only used for reporting payments made to individuals. In reality, the form is used to report payments made to both individuals and entities, such as corporations, partnerships, or trusts, provided these payments are subject to US source income and are reportable under chapters 3 and 4 of the Internal Revenue Code.

  • Used exclusively for reporting employee wages: While Form 1042-S can be used to report compensation for services performed in the United States by non-resident aliens, it is not limited to reporting wages. The form covers a broad range of US source income paid to foreign persons, including scholarships, royalties, dividends, and interest.

  • Substitute for Form W-2 or 1099: Another misconception is that Form 1042-S can serve as a substitute for Form W-2 or Form 1099. Although they all report income, Form 1042-S specifically reports income paid to non-resident aliens under the applicable tax treaty provisions, whereas Forms W-2 and 1099 report income for U.S. citizens or resident aliens.

  • Payments to all non-resident aliens must be reported: Not all payments made to non-resident aliens require reporting on Form 1042-S. The requirement to file a Form 1042-S is based on the type of income and whether the income is subject to withholding under chapters 3 or 4 of the IRC. Certain exceptions and thresholds apply.

  • Filing is only the responsibility of the payer: While the primary responsibility for filing Form 1042-S falls on the payer, or withholding agent, of the US source income to foreign persons, the recipient of the income may also have an obligation to report this income on their annual tax return, depending on their personal tax situation and applicable treaties.

  • Only required for large payments: There's a belief that Form 1042-S is only required for large payments. The IRS requires reporting of payments regardless of the amount, provided they fall under reportable income categories. There are no minimum thresholds for reporting on Form 1042-S, unlike some other tax forms.

  • All foreign source income must be reported: This is incorrect. Form 1042-S is specifically intended for US source income that is paid to foreign persons. Income that originates from outside the United States is not reportable on Form 1042-S.

  • Form 1042-S is only filed electronically: Although electronic filing is encouraged and may be required for those submitting 250 or more forms, filers can also submit Form 1042-S in a paper format. The method of filing depends on the number of forms and the preference of the filer, as long as IRS requirements are met.

  • No penalties for late filing: Neglecting to file Form 1042-S by the due date can result in significant penalties. The IRS imposes penalties for late filing, failing to file, or incorrect filing of Form 1042-S. These penalties can increase over time and can be substantial.

Understanding these misconceptions about IRS Form 1042-S helps ensure compliance with U.S. tax laws, avoiding penalties, and fostering a better tax filing experience for both payers and foreign recipients of US source income.

Key takeaways

The IRS Form 1042-S is an important document for reporting amounts paid to foreign persons, including non-resident aliens, foreign partnerships, and foreign corporations, by a United States-based institution or business. Understanding the key aspects of this form can ensure compliance with U.S. tax laws while minimizing potential errors. Here are five key takeaways to bear in mind:

  • Identify the Recipient Correctly: It's essential to accurately identify the recipient of the funds. This includes the individual’s or entity’s name, address, and the tax identification number, if applicable. Correct identification ensures that the income is reported to the right party and helps in avoiding processing delays or errors.
  • Understand Different Income Codes: The Form 1042-S includes various income codes to classify the type of income being reported. These range from wages and salaries to dividends and royalties. Knowing which income code to use is critical for both the payer and the recipient, as it affects tax withholding and reporting requirements.
  • Accurate Withholding and Reporting: Accurately calculating and reporting any tax withheld is crucial. The Form 1042-S is used to report the amount withheld under chapters 3 and 4 of the Internal Revenue Code. Mistakes in withholding or reporting can lead to penalties. It is important to review the applicable tax treaty rates, if any, as they can significantly impact the amount of tax withheld.
  • Timely Submission: The IRS requires Form 1042-S to be submitted by March 15th of the year following the payment year. Failure to meet this deadline can result in penalties. However, an extension can be requested if more time is needed. Making sure the form is submitted on time is critical to staying compliant with U.S. tax laws.
  • Electronic Filing Requirement: For institutions or businesses submitting 250 or more Form 1042-S, electronic filing is mandatory. This method is not only more efficient but also environmentally friendly. Smaller entities, while not required, are encouraged to file electronically to reduce paper use and processing errors.

Given the complexity of international transactions and tax obligations, ensuring accuracy and compliance when filling out and using the IRS Form 1042-S cannot be overstated. Keeping these key points in mind can help streamline the process and avoid potential complications with the IRS.

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