Master Guide to Form 1042-S Compliance | E-Book

2024 Master Guide to Form 1042-S Compliance (E-Book)

Last revised: August 28, 2024

The 2024 Master Guide to Form 1042-S Compliance covers the federal tax compliance requirements your organization must meet for payments made to foreign entities and organizations, and to non-employee foreign individuals – including the legislative and regulatory changes which mean nearly all payers must now electronically file their Forms 1042-S to the IRS. 

The 2024 Guide highlights changes affecting your 2024 year-end reporting and also provides a year-round go-to reference on the essential issues of whether a potential payee’s status is U.S. or non-U.S. for tax purposes, whether the 30% statutory rate of federal income tax withholding must be retained from payments to non-U.S. entities and individuals, how reduced withholding under a tax treaty may be claimed and validated, and what information is required to be filed to the IRS on Forms 1042-S and Form 1042.

What’s new in the 2024 edition

• Electronic filing mandate expanded for Forms 1042-S and other tax information returns  
• New Form W-8EXP and new IRS Instructions for this withholding certificate you may receive from foreign governments and some foreign organizations (expanded Instructions and clarifications which will help with your validity review when a payee gives you a W-8EXP
• Additional explanation of what’s required on Form W-8BEN-E for a foreign vendor’s claim of a reduced tax withholding rate under benefit of a tax treaty 
• Tax treaty changes: Chile, Hungary, Russia
• Changes in IRS forms, box codes and instructions

Sections of the Form 1042-S Guide include due dates and line-by-line explanation of the IRS Form 1042-S and the related annual summary and reconciliation Form 1042; changes mandated for electronic filing to the IRS; Forms W-8 and 8233 you may receive from non-U.S. entities and individuals to certify their tax status and claim treaty benefits, including what information is required for a valid form; tax treaties and how they are used; requirements to withhold federal income tax, how to determine the withholding rate, and when and how to make the federal deposit; explanation of FATCA (the Foreign Account Tax Compliance Act) in regard to the additional compliance responsibilities it created for Accounts Payable; and more.  

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