Form 1042-S

What is a 1042-S?

Form 1042-S, or Foreign Persons US Source Income Subject to Withholding, reports for non-US persons or entities interest payments, dividends and substitute payments in lieu and applicable US source tax withholding, thereon, from US securities paid to foreign investors.

This information is also reported to the IRS.

It is possible to receive multiple 1042-S forms reporting different types of income during a given tax year.

Box 1 contains a code indicating the type of income being reported, shown below:

Code Income Type
6 Dividends
24 Substitute payments in lieu – dividends
01 Interest
29 Deposit (credit balance) interest
30 Original issue discount
33 Substitute payments in lieu – interest
50 Referral fees

Box 2 contains the gross US source income of the type indicated in box 1. Box 5 contains the withholding tax rate applied as determined by statute or applicable US tax treaty.

Box 6 contains an exemption code if the reportable income is exempt from withholding, for example interest and original issue discount.

Box 7 is the total amount of US federal tax withheld.