What are the requirements for filing 1042-S?

Form 1042-S is generally required when a U.S. payer withholds tax on certain income paid to a foreign person (nonresident alien, foreign partnership, foreign corporation, foreign trust, foreign estate, etc.), or when an amount is reportable under Chapter 3 or Chapter 4 (FATCA) even if no tax was withheld.

In general, you must file Form 1042-S if you:

• Make a payment of U.S.-source income to a foreign person that is:
  • subject to withholding under Chapter 3, or
  • reportable under Chapter 4 (FATCA), or
  • exempt from withholding but still reportable
• Withhold any amount of U.S. tax from payments to foreign persons
• Are a withholding agent, including:
  • U.S. businesses
  • financial institutions
  • brokers
  • partnerships
  • trusts/estates
  • certain government entities and other payors

Common reportable income includes:

• Dividends
• Interest
• Royalties
• Rent
• Compensation for services performed in the U.S.
• Scholarships/fellowships to foreign persons
• Certain pension, annuity, and insurance payments
• Other fixed or determinable annual or periodic income (FDAP)

You generally do not file 1042-S if:

• The payee is a U.S. person
• The payment is not reportable under Chapter 3 or 4
• The income is reportable on another form instead, and 1042-S is not required for withholding/reporting purposes

Filing deadlines

• Paper filing: generally due by March 15 following the calendar year of payment
• Electronic filing: required if filing 250 or more forms, and it’s generally due by the same date
• Recipient copies are also generally due by March 15

Related return

If you file Form 1042-S, you usually also must file:

• Form 1042 (Annual Withholding Tax Return for U.S. Source Income of Foreign Persons)

If you want, I can also give you a simple decision checklist for whether a payment needs a 1042-S.