| What is IRS Form 1042-S Annual Withholding Tax Return for U.S. Source Income of Foreign Persons?
The IRS form 1042-S is a "tax form for foreign individuals reporting income from a United States-based source--in other words, non-residents who conduct some form of business within the United States. This can include investments or capital distribution. The form is sent to the non-resident by the bank or corporation that handles the transaction."
Form 1042-S makes it easy for non resident individuals to keep track of the income that was generated within the United States. When these non resident taxpayers receive these forms they will know how much money they made in the United States as well as how much money was withheld for tax purposes, that would cover for any potential income tax liabilities.
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