Foreign Person's U.S. Source Income Subject to Withholding

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2015

Department of the Treasury
Internal Revenue Service

Instructions for Form 1042-S
Foreign Person's U.S. Source Income Subject to Withholding
Section references are to the Internal Revenue
Code unless otherwise noted.

Future Developments

For the latest information about
developments related to Form 1042-S,
and its instructions, such as legislation
enacted after they were published, go to
www.irs.gov/form1042-S.

General Instructions
Except as otherwise provided in
these instructions, use the 2015
CAUTION
Form 1042-S only for amounts
paid during 2015. Do not use the 2015
Form 1042-S for amounts paid during
2014.

!

Reminders
Foreign Account Tax Compliance Act
(FATCA). Beginning in 2014 the Form
1042-S was modified to accommodate
reporting of payments and amounts
withheld under the provisions commonly
known as FATCA or Chapter 4 of the
Internal Revenue Code (chapter 4) in
addition to those amounts required to be
reported under Chapter 3 of the Internal
Revenue Code (chapter 3). Form 1042-S
requires the reporting of an applicable
exemption to the extent withholding under
chapter 4 did not apply to a payment of
U.S source fixed or determinable annual
or periodical (FDAP) income (including
deposit interest) that is reportable on Form
1042-S. When a U.S. financial institution
or U.S branch of a foreign financial
institution reports a payment made to its
financial account, Form 1042-S also
requires the reporting of additional
information about a recipient of the
payment, such as the recipient's account
number, date of birth, and foreign taxpayer
identification number, if any. For
withholding agents, intermediaries,
flow-through entities, and recipients, Form
1042-S requires that the chapter 3 status
(or classification) and, when the payment
reported is a withholdable payment, the
chapter 4 status be reported on the form
according to codes provided in these
instructions. For the requirement of a
withholding agent to file a Form 1042-S for
chapter 4 purposes, see Regulations
section 1.1474-1(d).
Name and EIN of withholding agent.
Beginning in calendar year 2015, for
withholding agents that report amounts
Nov 07, 2014

withheld by another withholding agent,
Form 1042-S requires the name and EIN
of the withholding agent that withheld the
tax. This information was optional for 2014
but is required for 2015 and subsequent
years.
Substitute Forms. Withholding agents
that furnish a substitute Form 1042-S to
the recipient must furnish a separate
substitute Form 1042-S for each type of
income or payment. Withholding agents
are no longer permitted to combine all
income and payments on a single
substitute Form 1042-S and all fields on
the substitute form must match the copy
filed with the IRS.
Electronic filing requirement for financial institutions. Beginning January 1,
2014, financial institutions that are
required to report payments made under
chapter 3 or 4 must electronically file
Forms 1042-S (regardless of the number
of forms to file). See the instructions under
Electronic Reporting, later.
Specified Federal procurement payments. Specified Federal procurement
payments (described under section
5000C(b)) paid to foreign persons that are
subject to withholding under section
5000C must be reported on Form 1042-S.
For more information, see Specified
Federal Procurement Payments Made to
Foreign Persons, later.
Interest on deposits. Beginning January
1, 2013, deposit interest described in
section 871(i)(2)(A) aggregating $10 or
more paid to certain nonresident alien
individuals with respect to a deposit
maintained at an office within the United
States and held by a resident of certain
countries must be reported on Form
1042-S. For more information, see Interest
on deposits, later.
Primary Withholding Agent. Beginning
January 1, 2015, primary withholding
agent information (boxes 14a and 14b)
must be completed if you are reporting
amounts withheld by another withholding
agent (in box 8).
FIRE System. For files submitted on the
FIRE System, it is the responsibility of the
filer to check the status within 5 business
days to verify the results of the
transmission. The IRS will not mail error
reports for files that are bad.
Substitute forms. Any substitute forms
must comply with the rules set out in Pub.
1179, General Rules and Specifications
Cat. No. 64278A

for Substitute Forms 1096, 1098, 1099,
5498, W-2G, and 1042-S. A substitute of
Form 1042-S, Copy A, must be an exact
copy of Form 1042-S, Copy A. If it is not,
the form may be rejected as incorrect and
the IRS may impose penalties. For more
information, see Substitute Forms, later.

Purpose of Form

Use Form 1042-S to report income
described under Amounts Subject to
Reporting on Form 1042-S, later, and to
report amounts withheld under chapter 3
or chapter 4.
Use Form 1042-S to report specified
Federal procurement payments paid to
foreign persons that are subject to
withholding under section 5000C.
Also use Form 1042-S to report
distributions of effectively connected
income by a publicly traded partnership or
nominee. See Publicly Traded
Partnerships (Section 1446 Withholding
Tax), later.
Every person required to deduct
and withhold any tax under
CAUTION
chapter 3 or chapter 4 is liable for
such tax. Every person required to deduct
and withhold any tax on payments made
to expatriates is liable for such tax.

!

Do not use Form 1042-S to report an
item required to be reported on any of the
following forms.
Form W-2 (wages and other
compensation made to employees (other
than compensation for dependent
personal services for which the beneficial
owner is claiming treaty benefits),
including wages in the form of group-term
life insurance).
Form 1099.
Form 8288-A, Statement of Withholding
on Dispositions by Foreign Persons of
U.S. Real Property Interests, or Form
8805, Foreign Partner's Information
Statement of Section 1446 Withholding
Tax. Withholding agents otherwise
required to report a distribution partly on a
Form 8288-A or Form 8805 and partly on
a Form 1042-S may instead report the
entire amount on Form 8288-A or
Form 8805.
Form 8966, FATCA Report. Foreign
financial institutions (FFIs) sponsoring
entities of certain FFIs and other foreign
entities, and withholding agents are
required to report on Form 8966 certain
account holders and payees. An FFI or

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withholding agent may also be required to
file Form 1042-S to report payments of
U.S. source FDAP income made to such
persons and to report tax deducted and
withheld, if any.

Who Must File

Every withholding agent (defined in
Definitions, later) must file an information
return on Form 1042-S to report amounts
paid during the preceding calendar year
that are described under Amounts Subject
to Reporting on Form 1042-S, later.
However, withholding agents who are
individuals are not required to report a
payment on Form 1042-S if they are not
making the payment as part of their trade
or business and no withholding is required
to be made on the payment. For example,
an individual making a payment of interest
that qualifies for the portfolio interest
exception from withholding is not required
to report the payment if the portfolio
interest is paid on a loan that is not
connected to the individual's trade or
business. However, an individual who is a
withholding agent paying an amount that
actually has been subject to withholding is
required to report the payment. Also, an
individual paying an amount on which
withholding is required must report the
payment, whether or not the individual
actually withholds. See Multiple
Withholding Agent Rule, later, for
exceptions to reporting when another
person has reported the same payment to
the recipient. Also see Publicly Traded
Partnerships (Section 1446 Withholding
Tax), later.
Every payor of a specified Federal
procurement payment must file a Form
1042-S for payments withheld upon under
section 5000C.
You must otherwise file a Form 1042-S
even if you did not withhold tax under
chapter 3 because the income was
exempt from tax under a U.S. tax treaty or
the Code, including the exemption for
income that is effectively connected with
the conduct of a trade or business in the
United States, or you released the tax
withheld to the recipient. For exceptions,
see Amounts That Are Not Subject to
Reporting on Form 1042-S, later.
Amounts paid to an individual that is a
bona fide resident of a U.S. possession or
territory are not subject to reporting on
Form 1042-S if the beneficial owner of the
income is a U.S. citizen, national, or
resident alien (such amounts may be
subject to Form 1099 reporting).
If you file Form 1042-S, you also
must file Form 1042, Annual
CAUTION
Withholding Tax Return for U.S.
Source Income of Foreign Persons. See
Form 1042, and the instructions to the
form, for more information.

!

Where, When, and
How To File

See Pub. 1187, Specifications for
Filing Form 1042-S, Foreign
CAUTION
Person's U.S. Source Income
Subject to Withholding, Electronically, for
more information about filing extension
requests electronically instead of on Form
8809.

Copy A is filed with the Internal
Revenue Service. Send all paper Forms
1042-S with Form 1042-T, Annual
Summary and Transmittal of Forms
1042-S, to the address in the Form 1042-T
instructions. You must use Form 1042-T to
transmit paper Forms 1042-S. Use a
separate Form 1042-T to transmit each
type of Form 1042-S. See Payments by
U.S. Withholding Agents, later, and the
Form 1042-T instructions for more
information. If you are a financial institution
or have 250 or more Forms 1042-S to file
(irrespective of whether you are a financial
institution or not), follow the instructions
under Electronic Reporting, later.

If you are either a person (including a
corporation, partnership, individual, trust,
or estate) that is required to file 250 or
more Forms 1042-S, or a financial
institution, whether U.S. or foreign, you are
required to submit Forms 1042-S
electronically.

Forms 1042-S, whether filed on paper or
electronically, must be filed with the
Internal Revenue Service by March 15,
2016. You also are required to furnish
Form 1042-S to the recipient of the
income by March 15, 2016.

Attach only Copy A to Form
1042-T. Copies B, C, and D
should be provided to the
recipient of the income. Copy E should be
retained by the withholding agent.

TIP

With respect to a withholdable
payment, the recipient copy should be
provided to the intermediary or
flow-through entity named as a recipient
with respect to a chapter 4 reporting pool,
if applicable.
Extension of time to file. To request an
extension of time to file Forms 1042-S, file
Form 8809, Application for Extension of
Time To File Information Returns. See the
Form 8809 instructions for where to file
that form. You should request an
extension as soon as you are aware that
an extension is necessary, but no later
than the due date for filing Form 1042-S.
By filing Form 8809, you will get an
automatic 30-day extension to file Form
1042-S. If you need more time, a second
Form 8809 may be submitted before the
end of the initial extended due date. See
Form 8809 for more information.
Recipient copies. You may request
an extension of time to provide the
statements to recipients by sending a
letter to:
Internal Revenue Service
Information Returns Branch
Attn: Extension of Time
Coordinator
240 Murall Drive Mail Stop 4360
Kearneysville, WV 25430
See Extension to provide statements to
recipients in Pub. 515, Withholding of Tax
on Nonresident Aliens and Foreign
Entities.
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!

Electronic Reporting

Electronic submissions are filed using
the Filing Information Returns
Electronically (FIRE) System. The FIRE
System operates 24 hours a day, 7 days a
week, at fire.irs.gov. For more information,
see Pub. 1187.
The electronic filing requirement
applies separately to original and
amended returns. For a withholding agent
other than a financial institution, the filing
requirement applies individually to each
reporting entity as defined by its separate
taxpayer identification number (TIN). For
example, if you have 300 original Forms
1042-S, they must be filed electronically.
However, if 200 of those forms contained
erroneous information, the amended
returns may be filed on paper forms
because the number of amended Forms
1042-S is less than the 250-or-more filing
requirement.
If you file electronically, do not file
the same returns on paper.
CAUTION
Duplicate filing may cause
penalty notices to be generated.

!

Note. Even though as many as 249
Forms 1042-S may be submitted on paper
to the IRS by a filer other than a financial
institution, the IRS encourages filers to
transmit forms electronically.
Hardship waiver. For a withholding
agent other than a financial institution, QI,
WP, or WT, to receive a hardship waiver
from the required filing of Forms 1042-S
electronically, submit Form 8508, Request
for Waiver From Filing Information Returns
Electronically. Waiver requests should be
filed at least 45 days before the due date
of the returns. See Form 8508 for more
information.
Need assistance? For additional
information and instructions on filing
Forms 1042-S electronically, extensions of
time to file (Form 8809), and hardship
waivers (Form 8508), see Pub. 1187. You
also can call the Information Reporting
Program at 866-455-7438 (toll free) or
304-263-8700 (not a toll-free number). Do
not call the Information Reporting Program
to answer tax law questions. See Caution,
Instructions for Form 1042-S (2015)

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below, for additional information. The
Information Reporting Program also can
be reached by fax at 877-477-0572 (toll
free) and international fax at
304-579-4105 (not a toll-free number).
This call site does not answer tax
law questions concerning the
CAUTION
requirements for withholding of
tax on payments under chapter 3 or
chapter 4 of the Code. If you need such
assistance, you can call 267-941-1000
(not a toll-free number) from 6:00 a.m. to
11:00 p.m. Eastern time or write to:

!

Internal Revenue Service
International Section
Philadelphia, PA 19255-0725

Additional Information

For more information on the withholding of
tax, see Pub. 515. To order this
publication and other publications and
forms, call 1-800-TAX-FORM
(1-800-829-3676). You also can download
forms and publications from IRS.gov.

Record Retention

Withholding agents should retain a copy of
the information returns filed with the IRS,
or have the ability to reconstruct the data,
for at least 3 years after the reporting due
date.

Substitute Forms

The official Form 1042-S is the standard
for substitute forms. Because a substitute
form is a variation from the official form,
you should know the requirements of the
official form for the year of use before you
modify it to meet your needs. The IRS
provides several means of obtaining the
most frequently used tax forms. These
include the Internet and DVD. For details
on the requirements of substitute forms,
see Pub. 1179.
Note. Beginning calendar year 2015, a
withholding agent is required to provide a
recipient with a separate substitute Form
1042-S for each type of income or other
payment. All of the fields on the substitute
form must match the copy filed with the
IRS. However, if you are reporting bank
deposit interest paid to certain
nonresident aliens, you may truncate the
recipient's TIN on a substitute form.
Penalty for filing incorrect
substitute form. Privately printed
substitute Forms 1042-S must be exact
copies of both the format and content of
the official Form 1042-S. If you file a
substitute for Form 1042-S, Copy A, with
the IRS that is not an exact copy of the
official Form 1042-S, Copy A, you may be
subject to a penalty for failure to file a
correct return. See Penalties, later.

Instructions for Form 1042-S (2015)

Deposit Requirements

For information and rules concerning
federal tax deposits, see Depositing
Withheld Taxes in Pub. 515 or Deposit
Requirements in the Instructions for Form
1042.

Definitions
Withholding agent. A withholding agent
is any person, U.S. or foreign, that has
control, receipt, or custody of an amount
subject to withholding under chapter 3,
who can disburse or make payments of an
amount subject to withholding, or who
makes a withholdable payment under
chapter 4. The withholding agent may be
an individual, corporation, partnership,
trust, association, or any other entity. The
term withholding agent also includes, but
is not limited to, a qualified intermediary
(QI), a nonqualified intermediary (NQI), a
withholding foreign partnership (WP), a
withholding foreign trust (WT), a
flow-through entity, a U.S. branch that is
treated as a U.S. person under
Regulations section 1.1441-1(b)(2)(iv)(A),
a territory FI, a nominee under section
1446, and an authorized agent. A person
may be a withholding agent even if there is
no requirement to withhold from a
payment or if another person has already
withheld the required amount from a
payment.
In most cases, the U.S. person who
pays (or causes to be paid) the item of
U.S. source income to a foreign person (or
to its agent) must withhold. However,
other persons may be required to
withhold. For example, if a payment is
made by a QI (whether or not it assumes
primary withholding responsibility) and the
QI knows that withholding was not done
by the person from which it received the
payment, then that QI is required to do the
appropriate withholding. In addition,
withholding must be done by any QI that
assumes primary withholding
responsibility under chapters 3 and 4, a
WP, a WT, a U.S. branch that agrees to be
treated as a U.S. person under
Regulations section 1.1441-1(b)(2)(iv)(A),
or an authorized agent. Finally, if a
payment is made by an NQI or a
flow-through entity that knows, or has
reason to know, that withholding was not
done, that NQI or flow-through entity is
required to withhold since it also falls
within the definition of a withholding agent.
Account holder. Generally, the account
holder is the person that holds the
account. See Regulations section
1.1471-5(a).
Authorized agent. An agent is an
authorized agent for purposes of acting as
a reporting agent for filing Form 1042 or
making tax deposits and payments only if
all five of the following conditions apply.
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1. There is a written agreement
between the withholding agent and the
person acting as agent.
2. A Form 8655, Reporting Agent
Authorization, is filed with the IRS.
3. The books and records and
relevant personnel of the agent are
available to the withholding agent.
4. The withholding agent remains fully
liable for the acts of its agent and does not
assert any of the defenses that otherwise
may be available, and
5. If the agent is making deposits and
tax payments or filing Forms 1042-S on
behalf of its principal, the authorized agent
should be reported as the withholding
agent on Form 1042-S, boxes 12a through
12i.
A sponsoring entity is a reporting agent
with respect to withholdable payments
and must fulfill the above conditions to be
an authorized agent.
For complete details on these
conditions, see Regulations sections
1.1441-7(c) and 1.1474-1(a)(3)(ii).
Beneficial owner. For payments other
than those for which a reduced rate of
withholding is claimed under an income
tax treaty, the beneficial owner of income
in most cases is the person who is
required under U.S. tax principles to
include the income in gross income on a
tax return. A person is not a beneficial
owner of income, however, to the extent
that person is receiving the income as a
nominee, agent, or custodian, or to the
extent the person is a conduit whose
participation in a transaction is
disregarded. In the case of amounts paid
that do not constitute income, beneficial
ownership is determined as if the payment
were income.
Foreign partnerships, foreign simple
trusts, and foreign grantor trusts are not
the beneficial owners of income paid to
the partnership or trust. The beneficial
owners of income paid to a foreign
partnership in most cases are the partners
in the partnership, provided that the
partner is not itself a partnership, foreign
simple or grantor trust, nominee, or other
agent. The beneficial owner of income
paid to a foreign simple trust (a foreign
trust that is described in section 651(a)) in
most cases is the beneficiary of the trust, if
the beneficiary is not a foreign partnership,
foreign simple or grantor trust, nominee, or
other agent. The beneficial owner of a
foreign grantor trust (a foreign trust to the
extent that all or a part of the income of the
trust is treated as owned by the grantor or
another person under sections 671
through 679) is the person treated as the
owner of the trust. The beneficial owner of
income paid to a foreign complex trust (a
foreign trust that is not a foreign simple

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trust or foreign grantor trust) is the trust
itself.
The beneficial owner of income paid to
a foreign estate is the estate itself.
A payment to a U.S. partnership, U.S.
trust, or U.S. estate is not subject to
withholding under chapter 3 or 4. A U.S.
partnership, trust, or estate should provide
the withholding agent with a Form W-9,
Request for Taxpayer Identification
Number and Certification. In most cases,
these beneficial owner rules apply for
purposes of section 1446; however, there
are exceptions.
1. Chapter 3 withholding rate pool. A
payment of a single type of income,
determined in accordance with the income
codes used to file Form 1042-S, that is
subject to a single rate of withholding and
a single chapter 4 exemption code.
2. Chapter 4 withholding rate pool. A
pool of account holders or payees
provided on an FFI withholding statement
(or a chapter 4 withholding statement).
See Regulations section 1.1471-1(b)(20).

grantor trusts in most cases are
considered to be fiscally transparent with
respect to items of income received by
them.

Disregarded entity. A business entity
that has a single owner and is not a
corporation under Regulations section
301.7701-2(b) is disregarded as an entity
separate from its owner.

Deemed-Compliant FFI. A
deemed-compliant FFI is a foreign
financial institution that is deemed to
satisfy the requirements of section
1471(b) and is either a certified
deemed-compliant FFI or registered
deemed-compliant FFI (including a
reporting model 1 FFI). See Regulations
sections 1.1471-1(b)(12), (105), and (107)
for the definition of certified
deemed-compliant FFI, registered
deemed-compliant FFI, and reporting
model 1 FFI.

Dividend equivalent. To the extent
specified in section 871(m), and the
regulations thereunder, a dividend
equivalent is a payment that, directly or
indirectly, is contingent on, or determined
by reference to, the payment of a dividend
from U.S. sources. Dividend equivalent
payments include the following payments.
1. A substitute dividend made under a
securities lending or sale-repurchase
transaction involving a U.S. stock, and
2. A payment made under a specified
notional principal contract.
Exempt recipient. An exempt recipient is
any payee that is exempt from the Form
1099 reporting requirements.
Expatriate. A person is considered an
expatriate if he or she relinquishes U.S.
citizenship or, in the case of a long-term
resident of the United States, ceases to be
a lawful permanent resident as defined in
section 7701(b)(6).
Fiscally transparent entity. An entity is
treated as fiscally transparent with respect
to an item of income for which treaty
benefits are claimed to the extent that the
interest holders in the entity must, on a
current basis, take into account separately
their shares of an item of income paid to
the entity, whether or not distributed, and
must determine the character of the items
of income as if they were realized directly
from the sources from which realized by
the entity. For example, partnerships,
common trust funds, and simple trusts or

Flow-through entity. A flow-through
entity is a foreign partnership (other than a
withholding foreign partnership), a foreign
simple or grantor trust (other than a
withholding foreign trust), or, for any
payments for which a reduced rate of
withholding under an income tax treaty is
claimed, any entity to the extent the entity
is considered to be fiscally transparent
under section 894 with respect to the
payment by an interest holder's
jurisdiction.
Financial Institution. A financial
institution (FI) is an entity described in
Regulations section 1.1471-5(e).
Foreign Financial Institution (FFI). A
foreign financial institution (FFI) is an
entity described in Regulations section
1.1471-5(d) or as a financial institution
under an Intergovernmental Agreement
(IGA).

Nonparticipating FFI. A
nonparticipating FFI is a foreign financial
institution that is not a participating FFI,
deemed-compliant FFI, or exempt
beneficial owner.
Participating FFI. A participating FFI
is a foreign financial institution that has
agreed to satisfy the obligations of an FFI
agreement under chapter 4, including an
FFI described in a Model 2 IGA that has
agreed to comply with the requirements of
an FFI agreement (reporting model 2 FFI).
See Regulations section 1.1471-1(b)(73)
for the definition of a Model 2 IGA.
Foreign person. A foreign person
includes a nonresident alien individual, a
foreign corporation, a foreign partnership,
a foreign trust, a foreign estate, and any
other person that is not a U.S. person. The
term also includes a foreign branch or
office of a U.S. financial institution or U.S.
clearing organization if the foreign branch
is a QI. A payment to a U.S. branch of a
foreign person is treated as a payment to
a foreign person for purposes of Form
1042-S.

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Global intermediary identification
number. The global intermediary
identification number (GIIN) is the
identification number that is assigned to a
participating FFI (including a reporting
model 2 FFI), registered
deemed-compliant FFI (including a
reporting model 1 FFI), or other entity for
chapter 4 reporting purposes.
Intermediary. An intermediary is a
person that acts as a custodian, broker,
nominee, or otherwise as an agent for
another person, regardless of whether that
other person is the beneficial owner of the
amount paid, a flow-through entity, or
another intermediary.
Qualified intermediary (QI). A QI is
an intermediary that is a party to a
withholding agreement with the IRS. A QI
(other than a limited FFI) that is a financial
institution must have a chapter 4 status
described in Regulations section
1.1441-1(e)(5)(ii). An entity must indicate
its status as a QI on a Form W-8IMY
submitted to a withholding agent. For
information on a QI withholding
agreement, see Revenue Procedure
2014-39 (or any superseding revenue
procedure) and www.irs.gov/Businesses/
Corporations/Qualified-Intermediaries(QI).
A branch of a financial institution may
not act as a QI in a country that does not
have approved know-your-customer
(KYC) rules. Countries having approved
KYC rules are listed on IRS.gov. Branches
that operate in non-KYC approved
jurisdictions as intermediaries are required
to act as nonqualified intermediaries.
Nonqualified intermediary (NQI). An
NQI is any intermediary that is not a U.S.
person and that is not a QI.
Private arrangement intermediary
(PAI). A QI that is an FFI may enter into a
contractual agreement with another
intermediary under which the other
intermediary generally agrees to perform
all of the obligations of the QI with respect
to the accounts maintained directly by the
other intermediary. See the QI Agreement
for the requirements of a PAI and a QI's
agreement with a PAI.
Nonfinancial foreign entity. A
nonfinancial foreign entity (NFFE) is a
foreign entity or an entity incorporated or
organized under the laws of any U.S.
territory that is not a financial institution.
Excepted Nonfinancial foreign
entity. The term excepted NFFE means
an NFFE that is described in Regulations
section 1.1472-1(c)(1) and generally
includes a publicly traded corporation,
certain affiliated entities related to a
publicly traded corporation, certain
territory entities, active NFFEs, and
entities excluded from the definition of
Instructions for Form 1042-S (2015)

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foreign financial institution (excluded FFIs)
described in Regulations section
1.1471-5(e)(5).
Non-exempt recipient. A non-exempt
recipient is any person who is not an
exempt recipient under chapter 61 of the
Code.
Nonresident alien individual. Any
individual who is not a citizen or resident
of the United States is a nonresident alien
individual. An alien individual meeting
either the green card test or the
substantial presence test for the calendar
year is a resident alien. Any person not
meeting either test is a nonresident alien
individual. Additionally, an alien individual
not otherwise a citizen of the U.S. who is a
resident of a foreign country under the
residence article of an income tax treaty,
or an alien individual who is a bona fide
resident of Puerto Rico, Guam, the
Commonwealth of the Northern Mariana
Islands, the U.S. Virgin Islands, or
American Samoa, is a nonresident alien
individual. See Pub. 519, U.S. Tax Guide
for Aliens, for more information on resident
and nonresident alien status.
Even though a nonresident alien
individual married to a U.S.
CAUTION
citizen or resident alien may
choose to be treated as a resident alien for
certain purposes (for example, filing a joint
income tax return), such individual is still
treated as a nonresident alien for
withholding tax purposes.

!

Payer. A payer is the person for whom
the withholding agent acts as an
authorized agent pursuant to an
agreement whereby the withholding agent
agrees to withhold and report a payment.
Payee. Except as otherwise provided, the
payee is the person to whom a payment is
made, regardless of whether such person
is the beneficial owner of the amount or
treated as the recipient of the payment for
purposes of reporting on Form 1042-S.
See Regulations section 1.1471-3(a).
Presumption rules. For withholdable
payments and for amounts subject to
withholding under chapter 3, the
presumption rules are those rules that a
withholding agent must follow to
determine the status of a beneficial owner
or payee (for example, as a U.S. person or
a foreign person) when it cannot reliably
associate a payment with valid
documentation. See, for example,
Regulations sections 1.1441-1(b)(3),
1.1441-4(a), 1.1441-5(d) and (e),
1.1441-9(b)(3), 1.1446-1(c)(3), and
1.6049-5(d). Also see Pub. 515. For a
withholdable payment (defined in
Regulations section 1.1473-1(a)), the
withholding agent must also follow the
presumption rules under Regulations
sections 1.1471-3(f) and, for an FFI,
Instructions for Form 1042-S (2015)

1.1471-4(c)(4)(i) to determine the
chapter 4 status of the payee when it
cannot reliably associate a payment with
valid documentation.
Publicly traded partnership (PTP). A
PTP is any partnership in which interests
are regularly traded on an established
securities market or are readily tradable
on a secondary market (regardless of the
number of its partners). However, it does
not include a PTP treated as a corporation
under section 7704.
Qualified securities lender (QSL). A
QSL is a foreign financial institution that
satisfies all of the following.
It is a bank, custodian, broker-dealer, or
clearing organization that is regulated by
the government in its home jurisdiction
and that regularly borrows and lends the
securities of U.S. corporations to
unrelated customers.
It is subject to audit by the IRS under
section 7602 or by an external auditor if it
is a QI.
It provides to the withholding agent an
annual certification of its QSL status.
It meets the requirements to qualify as a
QSL provided in Notice 2010-46 for the
transition period and until additional
published guidance is issued. See Notice
2010-46, 2010-24 I.R.B. 757, available at
www.irs.gov/irb/2010-24_IRB/ar09.html.
Recalcitrant account holder. Generally,
a recalcitrant account holder is an account
holder of a participating or
deemed-compliant FFI that failed to
provide the documentation required under
chapter 4 to determine the account
holder's status or to report the account as
a U.S. account. See Regulations section
1.1471-5(g).
Recipient. For chapter 3 purposes, a
recipient includes any of the following.
A beneficial owner of income.
A QI.
A WP or WT.
A U.S. branch that is treated as a U.S.
person under Regulations section
1.1441-1(b)(2)(iv)(A).
A foreign partnership or a foreign trust
(other than a WP or WT), but only to the
extent the income is effectively connected
with its conduct of a trade or business in
the United States.
A payee who is not known to be the
beneficial owner, but who is presumed to
be a foreign person under the presumption
rules.
A PAI.
A partner receiving a distribution of
effectively connected income from a PTP
or nominee.
A QSL.
For chapter 3 purposes, a recipient
does not include any of the following.
An NQI.
-5-

A nonwithholding foreign partnership, if
the income is not effectively connected
with its conduct of a trade or business in
the United States.
A disregarded entity, other than a
hybrid entity claiming treaty benefits.
A foreign trust that is described in
section 651(a) (a foreign simple trust) if
the income is not effectively connected
with the conduct of a trade or business in
the United States.
A foreign trust to the extent that all or a
part of the trust is treated as owned by the
grantor or other person under sections
671 through 679 (a foreign grantor trust).
A U.S. branch that is not treated as a
U.S. person unless the income is, or is
treated as, effectively connected with the
conduct of a trade or business in the
United States.
For chapter 4 purposes, a recipient
also includes any of the following.
A recalcitrant account holder not
included in a chapter 4 reporting pool.
A QI.
A WP or WT.
A PAI.
A participating FFI or
deemed-compliant FFI that is an NQI,
NWP, or NWT and provides chapter 4
withholding rate pool information to the
extent permissible.
A participating FFI or
deemed-compliant FFI that is the
beneficial owner, including a nonreporting
FFI under a model 1 or 2 IGA.
A U.S. branch or territory FI treated as a
U.S. person under Regulations section
1.1441-1(b)(2)(iv)(A).
An NFFE that is not a flow-through
entity or acting as an intermediary.
A foreign partnership or a foreign trust
(other than a WP or WT), but only to the
extent the income is effectively connected
with its conduct of a trade or business in
the United States.
A partner or beneficiary of a
flow-through entity that is an NFFE (other
than a WP or WT).
A nonparticipating FFI that is a
beneficial owner.
An exempt beneficial owner that is not a
flow-through entity or acting as an
intermediary.
For chapter 4 purposes, a recipient is
generally the same person that is a
recipient for chapter 3 purposes but does
not include any of the following.
An account holder, partner, beneficiary,
owner, or payee of a nonparticipating FFI
unless it is an exempt beneficial owner.
A participating FFI or
deemed-compliant FFI if the withholding
agent issues a Form 1042-S to the FFI’s
account holder, partner, owner, or payee.
An account holder, partner, owner, or
payee of a participating FFI or registered

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deemed-compliant FFI that is included in a
chapter 4 reporting pool.
Specified notional principal contract
(SNPC). An SNPC is any notional
principal contract that satisfies one or
more of the following.
In connection with entering into the
contract, any long party to the contract
transfers the underlying security to any
short party to the contract.
In connection with the termination of the
contract, any short party to the contract
transfers the underlying security to any
long party to the contract.
The underlying security is not readily
tradable on an established securities
market.
In connection with entering into the
contract, the underlying security is posted
as collateral by any short party to the
contract with any long party to the
contract.
The IRS identifies the contract as an
SNPC.
Territory FI. A territory FI is a financial
institution that is incorporated or organized
under the laws of any U.S. territory and is
not an investment entity. See Regulations
section 1.1471-5(e)(1)(iii) for the definition
of investment entity.
U.S. branch treated as a U.S. person.
A U.S. branch may agree to be treated as
a U.S. person if it meets the requirements
described in the regulations under
chapter 3. See Regulations section
1.1441-1(b)(2)(iv)(A). Additionally, a
territory FI may agree to be treated as a
U.S. person.
The U.S. branch or territory FI must
provide a Form W-8IMY evidencing that it
is agreeing to be treated as a U.S. person.
A U.S. branch that is treated as a
U.S. person is treated as such
CAUTION
solely for purposes of
determining whether a payment is subject
to withholding. The branch is, for purposes
of information reporting, a foreign person,
and payments to such a branch must be
reported on Form 1042-S.

!

Withholdable payment. A withholdable
payment is a payment described in
Regulations section 1.1473-1(a).
Withholding certificate. The term
“withholding certificate” refers to Form
W-8 or Form W-9 in most cases.
Note. Throughout these instructions, a
reference to or mention of “Form W-8” is a
reference to Forms W-8BEN, W-8BEN-E,
W-8ECI, W-8EXP, and/or W-8IMY.
Withholding foreign partnership (WP)
or withholding foreign trust (WT). A
WP or WT is a foreign partnership or trust
that has entered into a withholding
agreement with the IRS in which it agrees

to assume primary withholding
responsibility for all payments that are
made to it for its partners, beneficiaries, or
owners under chapter 3 (except for
sections 1445 and 1446) and under
chapter 4. For information on these
withholding agreements, see Revenue
Procedure 2014-47 (and any superseding
revenue procedure) and Regulations
section 1.1441-5.
Nonwithholding foreign partnership
(NWP) or nonwithholding foreign trust
(NWT). An NWP or NWT is any
partnership or trust (other than a complex
trust) that is not a U.S. person and that is
not a WP or WT.

Amounts Subject to
Reporting on Form 1042-S

Amounts subject to reporting on Form
1042-S are amounts from U.S. sources
paid to foreign persons (including persons
presumed to be foreign) or included in a
U.S. payee pool that are reportable under
chapters 3 and 4, even if no amount is
deducted and withheld from the payment
because of a treaty or Code exception to
taxation or if any amount withheld was
repaid to the payee. Amounts subject to
reporting are amounts from sources within
the United States that constitute (a) fixed
or determinable annual or periodical
(FDAP) income (including deposit
interest); (b) certain gains from the
disposal of timber, coal, or domestic iron
ore with a retained economic interest; and
(c) gains relating to contingent payments
received from the sale or exchange of
patents, copyrights, and similar intangible
property. A payment is also subject to
reporting if withholding under chapter 4 is
applied (or required to be applied) to the
payment. Amounts subject to reporting on
Form 1042-S include, but are not limited
to, the following amounts to the extent
from U.S. sources.
Interest on deposits paid to certain
nonresident aliens. Interest described in
section 871(i)(2)(A) aggregating $10 or
more paid with respect to a deposit
maintained at an office within the United
States if such interest is paid to a
nonresident alien individual who is a
resident of a country identified, in
Revenue Procedure 2012-24 (or a
superseding Revenue Procedure) as of
December 31, prior to the calendar year in
which the interest is paid. A payor may
elect to report interest described above
paid to any nonresident alien individual by
reporting all such interest. See Revenue
Procedure 2012-24 (or a superseding
Revenue Procedure) for the current list of
countries with which the United States has
in effect an income tax or other convention
or bilateral agreement relating to
exchange information within the meaning
of section 6103(k)(4).
-6-

When completing Form 1042-S, use
income code 29 in box 1 and exemption
code 02 in box 3a for chapter 3 purposes
and the applicable chapter 4 exemption
code in box 4a, if any (see the instructions
for boxes 3a and 4a, later).
If you issue a substitute Form 1042-S
to the recipient, the substitute form must
include a statement that the information on
the form is being furnished to the United
States Internal Revenue Service.
Interest on deposits subject to
chapter 4 withholding. Interest on
deposits from U.S. sources are
withholdable payments and, therefore,
may be subject to withholding under
chapter 4 and, if withheld upon, reporting
is required.
Corporate distributions. The entire
amount of a corporate distribution
(whether actual or deemed) must be
reported, regardless of any estimate of the
part of the distribution that represents a
taxable dividend. Any distribution,
however, that is treated as gain from the
redemption of stock is not an amount
subject to withholding. For information on
dividends paid by a qualified investment
entity (QIE), see Pub. 515.
Interest. This includes the part of a
notional principal contract payment that is
characterized as interest.
Rents.
Royalties.
Compensation for independent
personal services performed in the
United States.
Compensation for dependent
personal services performed in the
United States (but only if the beneficial
owner is claiming treaty benefits).
Annuities.
Pension distributions and other
deferred income.
Most gambling winnings. However,
proceeds from a wager placed in
blackjack, baccarat, craps, roulette, or
big-6 wheel are not amounts subject to
reporting.
Cancellation of indebtedness.
Income from the cancellation of
indebtedness must be reported unless the
withholding agent is unrelated to the
debtor and does not have knowledge of
the facts that give rise to the payment.
Effectively connected income (ECI).
ECI includes amounts that are (or are
presumed to be) effectively connected
with the conduct of a trade or business in
the United States even if no withholding
certificate is required. Note that bank
deposit interest is subject to Form 1042-S
reporting if it is ECI or otherwise reportable
on Form 1042-S (see interest on deposits,
earlier). ECI of a PTP distributed to a
foreign partner must be reported on Form
1042-S.
Notional principal contract income.
Income from notional principal contracts
Instructions for Form 1042-S (2015)

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that the payer knows, or must presume, is
effectively connected with the conduct of a
U.S. trade or business is subject to
reporting using income code 32. The
amount to be reported is the amount of
cash paid on the contract during the
calendar year. Any amount of interest
determined under the provisions of
Regulations section 1.446-3(g)(4) (dealing
with interest in the case of a significant
non-periodic payment) is reportable as
interest and not as notional principal
contract income. See, however, the
separate reporting for U.S.-source
dividend equivalent payments.
Insurance premiums. Insurance
premiums from U.S. sources (regardless
of whether or not the premium payments
are subject to the section 4371 excise tax)
are withholdable payments and, if the
payment is actually withheld upon or
should have been withheld upon (but the
withholding agent failed to withhold), such
amount must be reported on Form
1042-S. Insurance premiums from U.S.
sources are amounts subject to chapter 3
withholding (excluding amounts subject to
the section 4371 excise tax) that must be
reported on Form 1042-S.
REMIC excess inclusions. Excess
inclusions from REMICs (income code 02)
and withheld tax must be reported on
Form 1042-S. A domestic partnership
must separately state a partner's allocable
share of REMIC taxable income or net
loss and the excess inclusion amount on
Schedule K-1 (Form 1065). If the
partnership allocates all or some part of its
allocable share of REMIC taxable income
to a foreign partner, the partner must
include the partner's allocated amount in
income as if that amount was received on
the earliest to occur of (1) the date of
distribution by the partnership; (2) the date
the foreign partner disposes of its indirect
interest in the REMIC residual interest; or
(3) the last day of the partnership's tax
year.
The partnership must withhold tax on
the part of the REMIC amount that is an
excess inclusion.
An excess inclusion allocated to the
following foreign persons must be
included in that person's income at the
same time as other income from the entity
is included in income.
Shareholder of a real estate investment
trust.
Shareholder of a regulated investment
company.
Participant in a common trust fund.
Patron of a subchapter T cooperative
organization.
Students, teachers, and
researchers. Amounts paid to foreign
students, trainees, teachers, or
researchers as scholarship or fellowship
income, and compensation for personal
services (whether or not exempt from tax
Instructions for Form 1042-S (2015)

under an income tax treaty), must be
reported. However, amounts that are
exempt from tax under section 117 are not
subject to reporting.
Amounts paid to foreign
governments, foreign central banks of
issue, and international organizations.
These amounts are subject to reporting
even if they are exempt from chapter 3
withholding under section 892 or 895.
Foreign targeted registered
obligations. Interest paid on registered
obligations targeted to foreign markets
paid by a U.S. person to a foreign person
other than a financial institution or a
member of a clearing organization is an
amount subject to reporting.
Original Issue Discount (OID) from
the redemption of an OID obligation.
The amount subject to reporting is the
amount of OID actually includible in the
gross income of the foreign beneficial
owner of the income, if known. Otherwise,
the withholding agent should report the
entire amount of OID as if the recipient
held the instrument from the date of
original issuance. See Pub. 1212, Guide
to Original Issue Discount (OID)
Instruments.
Certain dispositions of U.S. real
property interests. See Withholding on
Dispositions of U.S. Real Property
Interests by Publicly Traded Trusts and
Qualified Investment Entities (QIEs), later.
Other U.S.-source dividend
equivalent payments. Other U.S.-source
dividend equivalent payments are
payments other than substitute dividends
that qualify as U.S.-source dividends
under section 871(m) and the regulations
thereunder. Report these amounts using
income code 40 or 53.
Guarantee of indebtedness.This
includes amounts paid, directly or
indirectly, for the provision of a guarantee
of indebtedness issued after September
27, 2010. They must be paid by a
non-corporate resident or U.S. corporation
or by any foreign person if the amounts
are effectively connected with the conduct
of a U.S. trade or business. Report these
amounts using income code 41.
Specified Federal procurement
payments. Specified Federal
procurement payments subject to
withholding under section 5000C.

Amounts That Are Not
Subject to Reporting
on Form 1042-S
Interest and OID from short-term obligations. Interest and OID from any
obligation payable 183 days or less from
the date of original issue should not be
reported on Form 1042-S. See, however,
the reporting requirements for deposit
interest described earlier.
-7-

Registered obligations targeted to foreign markets. Interest on a registered
obligation that is targeted to foreign
markets and that qualifies as portfolio
interest is not subject to reporting if it is
paid to a registered owner that is a
financial institution or member of a
clearing organization and you have
received the required certifications.
Reporting will be required on
interest paid on any registered
CAUTION
obligation (regardless of whether
targeted to foreign markets) if the
registered obligation is issued after
December 31, 2015.

!

Bearer obligations targeted to foreign
markets. Do not file Form 1042-S to
report interest not subject to withholding
on bearer obligations if a Form W-8 is not
required.
Withholding is required on
interest paid on any bearer
CAUTION
obligations targeted to foreign
markets if the obligation is issued after
March 18, 2012. You must file Form
1042-S to report this interest paid on an
obligation issued after that date.

!

Notional principal contract payments
that are not ECI. Amounts paid on a
notional principal contract other than a
specified notional principal contract
(SNPC) other than income that is not
effectively connected with the conduct of a
trade or business in the United States
should not be reported on Form 1042-S.
All amounts paid on an SNPC that are
treated as dividend equivalent payments
should be reported as such on Form
1042-S.
Accrued interest and OID. Interest paid
on obligations sold between interest
payment dates and the part of the
purchase price of an OID obligation that is
sold or exchanged in a transaction other
than a redemption is not subject to
reporting unless the sale or exchange is
part of a plan, the principal purpose of
which is to avoid tax, and the withholding
agent has actual knowledge or reason to
know of such plan.
Certain withholdable payments.
Withholdable payments not subject to
reporting for chapter 3 purposes (other
than bank deposit interest paid to certain
nonresident aliens) are not required to be
reported if withholding is not applied (or
required to be applied) under chapter 4.

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Withholding on
Dispositions of U.S. Real
Property Interests by
Publicly Traded Trusts
and Qualified Investment
Entities (QIEs)

In general, when a publicly traded trust
makes a distribution to a foreign person
attributable to the disposition of a U.S. real
property interest, it must withhold tax
under section 1445. However, this
withholding liability is shifted to the person
who pays the distribution to a foreign
person (or to the account of the foreign
person) if the special notice requirement
of Regulations section 1.1445-8(f) and
other requirements of Regulations section
1.1445-8(b)(1) are satisfied.
The amount subject to withholding for a
distribution by a publicly traded trust is
determined under the large trust rules of
Regulations section 1.1445-5(c)(3).
The rate of withholding is as follows:
1. Distribution by a publicly traded
trust that makes recurring sales of growing
crops and timber – 10%.
2. Distribution by a publicly traded
trust not described in (1) above – 35%.
Special rules apply to qualified
investment entities (QIEs). A QIE is one of
the following.
A real estate investment trust (REIT).
A regulated investment company (RIC)
that is a U.S. real property holding
corporation. The special rule for a RIC
applies only for distributions by the RIC
that are directly or indirectly attributable to
distributions the RIC received from a
REIT.
In most cases, any distribution from a
QIE attributable to gain from the sale or
exchange of a U.S. real property interest is
treated as such gain by the nonresident
alien, foreign corporation, or other QIE
receiving the distribution.
A distribution by a QIE to a nonresident
alien or foreign corporation that is treated
as gain from the sale or exchange of a
U.S. real property interest by the
shareholder is subject to withholding at
35%.
Any distribution by a QIE on stock
regularly traded on a securities market in
the United States is not treated as gain
from the sale or exchange of a U.S. real
property interest if the shareholder did not
own more than 5% of that stock at any
time during the 1-year period ending on
the date of the distribution. These
distributions are included in the
shareholder's gross income as a dividend
(income code 06) from the QIE, not as
long-term capital gain.

Use Forms 1042-S and 1042 to report
and pay over the withheld amounts. All
other withholding required under section
1445 is reported and paid over using Form
8288, U.S. Withholding Tax Return for
Dispositions by Foreign Persons of U.S.
Real Property Interests, and Form 8288-A,
Statement of Withholding on Dispositions
by Foreign Persons of U.S. Real Property
Interests.

Copy A filed with the IRS. These filers
must use a separate Form 1042-S (or
substitute form) for information reportable
on a single type of income.
See Payments Made to Persons Who
Are Not Recipients, later, if the payment is
made to a foreign person that is not a
recipient.

For more information on reporting
income from real property interests, see
U.S. Real Property Interest in Pub. 515.

Payments directly to beneficial owners. A U.S. withholding agent making a
payment directly to a beneficial owner
must complete Form 1042-S and treat the
beneficial owner as the recipient. Boxes
15a through 15i should be left blank. The
Form 1042-S must also include the
appropriate chapter 3 and chapter 4
exemption codes, if applicable, in boxes
3a and 4a, as well as the appropriate
recipient codes for the chapter 3 and
chapter 4 status codes for a payment that
is a withholdable payment and an amount
subject to chapter 3 withholding. A U.S.
withholding agent should complete boxes
18 through 20 only if it is completing Form
1042-S as a paying agent acting pursuant
to an agreement to act as an authorized
agent for filing and reporting Form 1042
and 1042-S.
In the case of foreign joint owners, you
may provide a single Form 1042-S made
out to the owner whose status you relied
upon to determine the applicable rate of
withholding (the owner subject to the
highest rate of withholding). If, however,
any one of the owners requests its own
Form 1042-S, you must furnish a Form
1042-S to the person who requests it, and
you should amend the originally filed Form
1042-S. If more than one Form 1042-S is
issued for a single payment, the aggregate
amount paid and tax withheld that is
reported on all Forms 1042-S cannot
exceed the total amounts paid to joint
owners and the tax withheld on those
payments.

Publicly Traded
Partnerships (Section
1446 Withholding Tax)

A publicly traded partnership (PTP)
(defined earlier in Definitions) that has
effectively connected income, gain, or loss
must pay a withholding tax under section
1446 on distributions of that income made
to its foreign partners and file Form
1042-S using income code 27 and
chapter 4 exemption code 14. A nominee
that receives a distribution of effectively
connected income from a PTP is treated
as the withholding agent to the extent of
the amount specified in the qualified
notice received by the nominee. For this
purpose, a nominee is a domestic person
that holds an interest in a PTP on behalf of
a foreign person. See Regulations section
1.1446-4 and Pub. 515 for details.
If you are a nominee that is the
withholding agent under section
1446, enter the PTP's name and
other required information in boxes 15a
through 15i on Form 1042-S.

TIP

Partnerships (other than publicly traded
partnerships) that have effectively
connected gross income allocable to
foreign partners must file Form 8804,
Annual Return for Partnership Withholding
Tax (Section 1446). If these partnerships
have effectively connected taxable income
allocable to foreign partners, they must
also pay a withholding tax under section
1446 and report these amounts on Form
8804 and the partners' allocable shares of
these amounts on Form 8805, Foreign
Partner's Information Statement of Section
1446 Withholding Tax.

Payments by U.S.
Withholding Agents
In general. U.S. withholding agents
making payments described under
Amounts Subject to Reporting on Form
1042-S, earlier, must file a separate Form
1042-S for each recipient who receives
the income. Furthermore, withholding
agents filing paper Forms 1042-S are not
permitted to report multiple types of
income on a Form 1042-S (or substitute
form 1042-S) furnished to a recipient or on
-8-

Payments to Recipients

Example. WA, a U.S. withholding
agent, makes a withholdable payment of
U.S. source dividends to A, a foreign
individual from whom it has received a
Form W-8BEN and who is not eligible for a
reduced rate of chapter 3 withholding
under a treaty. WA must file a Form
1042-S for A with “06” in box 1 (income
code), “00” in box 3a (chapter 3 exemption
code), “30.00” in box 3b (chapter 3 tax
rate), “15” in box 4a (payee not subject to
chapter 4 withholding), “00.00” in box 4b
(chapter 4 tax rate), “16” in box 13b
(individual), and “27” in box 13c
(individual).
Payments to a qualified intermediary,
withholding foreign partnership, or
withholding foreign trust. A U.S.
withholding agent that makes payments to
a QI (whether or not the QI assumes
primary withholding responsibility), a
Instructions for Form 1042-S (2015)

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withholding foreign partnership (WP), or a
withholding foreign trust (WT) should
complete Form 1042-S in most cases,
treating the QI, WP, or WT as the
recipient. See Payments allocated, or
presumed made, to U.S. non-exempt
recipients, later, for exceptions. A QI that
does not assume primary withholding
responsibility is required to provide
information regarding the proportions of
income subject to a particular withholding
rate to the withholding agent on the
withholding statement associated with its
Form W-8IMY. In such a case, the U.S.
withholding agent must complete a
separate Form 1042-S for each
withholding rate pool of the QI. For
purposes of chapter 4, a QI may provide a
single pool of recalcitrant account holders
(rather than separate pools for each
class). In such a case, the withholding
agent may use chapter 4 pooled reporting
code 49 (QI-Recalcitrant Pool-General). A
QI that assumes primary withholding
responsibility, a WP, or a WT is not
required to provide withholding rate pool
information to a withholding agent but will
report such information directly to the IRS.
A U.S. withholding agent making
payments to a QI (that assumes primary
withholding responsibility), a WP, or a WT
must use recipient code 12 (qualified
intermediary), 09 (withholding foreign
partnership), or 11 (withholding foreign
trust) as the chapter 3 status code and
must use recipient code 05 (participating
FFI- other), 06 (participating FFI- reporting
model 2 FFI), 07 (registered
deemed-compliant FFI- reporting model 1
FFI), 09 (registered deemed-compliant
FFI-other), for an FFI treated as
deemed-compliant under an IGA, 31 (non
reporting IGA FFI) or, for a payment to a
QI, 27 (exempt beneficial owner) as the
chapter 4 status code if the entity is an FFI
that receives a withholdable payment and
provides chapter 4 withholding rate pool
information. A U.S. withholding agent
must not use any chapter 3 pooled
reporting code (codes 27 through 33). Use
of an inappropriate recipient code may
cause a notice to be generated.
A QI is required to act in such
capacity only for designated
CAUTION
accounts. Therefore, such an
entity also may provide a Form W-8IMY in
which it certifies that it is acting as an NQI
for other accounts and, if it is an FFI that is
receiving a withholdable payment, that it is
a participating FFI, registered
deemed-compliant FFI, or FFI treated as
deemed-compliant under an IGA. A U.S.
withholding agent that receives a Form
W-8IMY on which the foreign person
providing the form indicates that it is not
acting as a QI may not treat the foreign
person as a recipient except as otherwise
provided in these instructions. A
withholding agent must not use the EIN

!

Instructions for Form 1042-S (2015)

that a QI provides in its capacity as such
to report payments that are treated as
made to an entity in its capacity as an NQI.
In that case, use the GIIN, if any, and EIN
that is provided by the entity on its Form
W-8IMY in which it claims that it is acting
as an NQI or flow-through entity.
Note. A withholding agent is required to
use chapter 4 reporting pool codes as the
chapter 4 status code in the case of
withholdable payments made to:
A QI that does not assume primary
withholding responsibility;
A participating FFI or registered
deemed-compliant FFI that is an NQI,
NWP, or NWT; or
An NQI, NWP, or NWT (other than a
nonparticipating FFI) that provides a pool
of nonparticipating FFIs,
if the QI, NQI, NWP, or NWT provides
chapter 4 withholding rate pool information
in the withholding statement associated
with its Form W-8IMY. See the
presumption rules under Regulations
section 1.1471-3(f) if such information is
not provided for a withholdable payment
made to an entity.
Example 1. WA, a U.S. withholding
agent, makes a withholdable payment of
U.S. source dividends to QI, a qualified
intermediary that does not assume
primary chapters 3 and 4 withholding
responsibility and that is a participating
FFI. QI provides WA with a valid Form
W-8IMY with which it associates a
withholding statement that allocates 95%
of the payment to a chapter 3, 15%
withholding rate pool with a single
chapter 4 exemption code, and 5% of the
payment to a chapter 4, 30% withholding
rate pool of recalcitrant account holders.
WA must complete a Form 1042-S, for the
dividends allocated to the chapter 3, 15%
withholding rate pool, showing “15.00” in
box 3b (chapter 3 tax rate), “00” in box 3a
(chapter 3 exemption code), chapter 4
exemption code 15 (payee not subject to
chapter 4 withholding) in box 4a, “00.00” in
box 4b (chapter 4 tax rate) and QI as the
recipient in box 13d along with recipient
code 12 (qualified intermediary) as the
chapter 3 status code and recipient code
05 (participating FFI- other) as the
chapter 4 status code. WA must also
complete a Form 1042-S, for the
dividends allocated to the chapter 4, 30%
withholding rate pool, showing chapter 3
exemption code 12 (payee subjected to
chapter 4 withholding) in box 3a,“00.00” in
box 3b (chapter 3 tax rate), “00” in box 4a
(chapter 4 exemption code), and “30.00”
in box 4b with QI as the recipient in
box 13d and recipient code 12 (qualified
intermediary) as the chapter 3 status code
and recipient code 49 (QI‐Recalcitrant
Pool‐General) as the chapter 4 status
code.
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Payments allocated, or presumed
made, to U.S. non-exempt recipients.
A QI may provide Forms W-9 or other
information regarding U.S. non-exempt
recipients that the QI (or other entity
maintaining the account) is required to
report under chapter 61 and for which the
QI does not assume primary Form 1099
reporting responsibility. QI may also
provide information regarding U.S.
non-exempt recipients that QI elects to
backup withhold under section 3406
instead of withholding under chapter 4 on
payments made to an account holder. If
Forms W-9 or other information is
provided together with information
allocating all or a part of the payment to
U.S. non-exempt recipients, you must
report income allocable to the U.S.
non-exempt recipients on the appropriate
Form 1099 and not on Form 1042-S even
though you are paying that income to a QI.
QI may also provide information regarding
U.S. non-exempt recipients in a chapter 4
withholding rate pool that the withholding
agent must report on Form 1042-S.
You also may be required under the
presumption rules to treat a payment
made to a QI as made to a payee that is a
U.S. non-exempt recipient from which you
must withhold on the payment under the
backup withholding provisions of the
Code. In this case, you must report the
payment on the appropriate Form 1099.
See the General Instructions for Certain
Information Returns.
Example 2. WA, a U.S. withholding
agent, makes a withholdable payment of
U.S. source dividends to QI, a qualified
intermediary and registered
deemed-compliant FFI that is a local FFI
described in Regulations section
1.1471-5(f)(1)(i)(A). QI provides WA with a
valid Form W-8IMY certifying that it is
transmitting Forms W-9 for U.S.
non-exempt recipients and with which it
associates a withholding statement that
allocates 95% of the payment to a
chapter 3, 15% withholding rate pool with
a single chapter 4 exemption code, and
5% of the payment to C, a U.S. individual.
QI also provides WA with C's Form W-9. C
is a direct account holder of QI and a U.S.
citizen that is a resident of QI's local
jurisdiction that QI is not required to report
under chapter 4 (see Regulations section
1.1471-5(f)(1)(i)(A)) and thus cannot be
included in a chapter 4 withholding rate
pool of U.S. payees. See Regulations
section 1.6049-4(c)(4). WA must complete
a Form 1042-S, showing QI as the
recipient in box 13d, and WA should use
recipient code 09 (qualified intermediary)
as the chapter 3 status code and recipient
code 09 (registered deemed-compliant
FFI – other) as the chapter 4 status code
for the dividends allocated to the 15%
withholding rate pool. WA also must
complete a Form 1099-DIV issued to C

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reporting the part of the dividend allocated
to C.
Example 3. WA, a withholding agent,
makes a withholdable payment of U.S.
source dividends to QI, a qualified
intermediary that is a reporting model 1
FFI. QI provides WA with a valid Form
W-8IMY with which it associates a
withholding statement that allocates 40%
of the payment to a chapter 3, 15%
withholding rate pool and 40% to a
chapter 3, 30% withholding rate pool. QI
does not provide any withholding rate pool
information regarding the remaining 20%
of the payment. WA must apply the
presumption rule to the part of the
payment (20%) that has not been
allocated. Under the presumption rules of
Regulations section 1.1471-3(f) for a
withholdable payment made to an entity,
20% of the payment is treated as paid to a
nonparticipating FFI. WA must complete
three Forms 1042-S. First, a Form 1042-S
for dividends subject to 15% withholding,
showing “00” in box 3a (chapter 3
exemption code), chapter 4 exemption
code 15 (payee not subject to chapter 4
withholding) in box 4a, QI as the recipient
in box 13d, recipient code 12 (qualified
intermediary) as the chapter 3 status
code, and recipient code 07 (registered
deemed-compliant FFI-reporting model 1
FFI) as the chapter 4 status code
(because the payment is a withholdable
payment). Second, a Form 1042-S for
dividends subject to 30% withholding,
showing “00” in box 3a (chapter 3
exemption code), chapter 4 exemption
code 15 (payee not subject to chapter 4
withholding) in box 4a, QI as the recipient
in box 13d, recipient code 12 (qualified
intermediary) as the chapter 3 status
code, and recipient code 07 (registered
deemed-compliant FFI – reporting model 1
FFI) as the chapter 4 status code. Third, a
Form 1042-S for dividends subject to 30%
withholding, showing chapter 3 exemption
code 12 (payee subjected to chapter 4
withholding), “00” in box 4a (chapter 4
exemption code), “Unknown Recipient” as
the recipient in box 13d and recipient code
21 (unknown recipient) as the chapter 3
status code and recipient code 29
(unknown recipient) as the chapter 4
status code. Also, QI's name, country
code, address, GIIN, and QI-EIN must be
entered in boxes 15a through 15i.
Amounts paid to qualified securities
lenders. A withholding agent that makes
payments of substitute dividends to a
qualified securities lender (QSL) should
complete Form 1042-S treating the QSL
as the recipient. Use income code 34. Use
recipient code 13 or 14 (qualified
securities lender – qualified intermediary
or qualified securities lender – other) as
the chapter 3 status code.

The withholding agent is not required to
withhold on a substitute dividend payment
if it receives, at least annually, a certificate
from the QSL that includes a statement
with the following information:
The recipient of the substitute dividend
is a QSL, and
With respect to the substitute dividend it
receives from the withholding agent, the
QSL states that it will withhold and remit or
pay the proper amount of U.S. gross-basis
tax. Use exemption code 11.
If the QSL is also a QI with primary
withholding responsibility, use exemption
code 11 and not exemption code 06 for
chapter 3 purposes.
Amounts paid to certain U.S. branches. A U.S. withholding agent making a
payment to a U.S. branch of an FFI or
NFFE completes Form 1042-S as follows:
If a withholding agent makes a payment
to a U.S. branch that has provided the
withholding agent with a Form W-8IMY
stating that it has agreed to be treated as a
U.S. person, the U.S. withholding agent
treats the U.S. branch as the recipient.
If a withholding agent makes a payment
to a U.S. branch that has provided a Form
W-8IMY to transmit information regarding
its chapter 4 reporting pools when the
payment is a withholdable payment or the
branch provides a chapter 4 withholding
rate pool of U.S. payees and, to the extent
applicable, recipient specific information
for chapter 3 purposes, the U.S.
withholding agent must complete a
separate Form 1042-S for each chapter 4
reporting pool treating the U.S. branch as
the recipient or, for chapter 3 purposes, for
each recipient that is a foreign person
whose documentation is associated with
the U.S. branch's Form W-8IMY. If a
payment cannot be reliably associated
with recipient documentation, the U.S.
withholding agent must complete Form
1042-S in accordance with the
presumption rules.
If a withholding agent cannot reliably
associate a payment with a Form W-8IMY
from a U.S. branch, and if a withholding
agent has an EIN for the branch, then the
payment may be reported on a single
Form 1042-S treating the U.S. branch as
the recipient and reporting the income as
effectively connected income.
Amounts paid to a foreign estate. If a
U.S. withholding agent makes a payment
to a foreign estate, a Form 1042-S must
be completed showing the estate as the
recipient. Use recipient code 17 (estate),
as the chapter 3 status code and the
applicable recipient code for the chapter 4
status code.
Dual claims. A U.S. withholding agent
may make a payment to a foreign entity
(for example, a hybrid entity) that is
simultaneously claiming an exemption
from chapter 4 withholding and a reduced
-10-

rate of tax under chapter 3 on its own
behalf for a part of the payment and an
exemption from chapter 4 withholding and
a reduced rate of tax under chapter 3 on
behalf of persons in their capacity as
interest holders in that entity on the
remaining part. If the claims are consistent
and the withholding agent has accepted
the multiple claims, a separate Form
1042-S must be filed for the entity for
those payments for which the entity is
treated as claiming a reduced rate of
withholding and separate Forms 1042-S
must be filed for each of the interest
holders for those payments for which the
interest holders are claiming a reduced
rate of withholding. The Forms 1042-S
must include the chapter 4 status of the
payee (including the applicable chapter 4
exemption). If the claims are consistent
but the withholding agent has not chosen
to accept the multiple claims, or if the
claims are inconsistent, a separate Form
1042-S must be filed for the person(s)
being treated as the recipient(s).
Special instructions for U.S. trusts and
estates. Report the entire amount of
income subject to reporting, regardless of
estimates of distributable net income.

Payments Made to Persons
Who Are Not Recipients
Disregarded entities. If a U.S.
withholding agent makes a payment to a
disregarded entity (other than a limited
branch of an FFI) that is not a hybrid entity
making a treaty claim, and receives a valid
Form W-8BEN-E or W-8ECI from a foreign
person that is the single owner of the
disregarded entity, the withholding agent
must file a Form 1042-S in the name of the
foreign single owner. The taxpayer
identifying number (TIN) on the Form
1042-S, if required, must be the foreign
single owner's TIN. However, in box 13h
include the GIIN of the disregarded entity
provided in Part II of Form W-8BEN-E.
Example. WA, a withholding agent,
makes a withholdable payment of interest
to LLC, a foreign limited liability company
that is not an FFI. LLC is wholly-owned by
FC, a foreign corporation that is an
excepted non-financial foreign entity. LLC
is treated as a disregarded entity. WA has
a Form W-8BEN-E from FC on which it
states that it is the beneficial owner of the
income paid to LLC. WA reports the
interest payment on Form 1042-S showing
FC as the recipient. The result would be
the same if LLC was a domestic entity.
A disregarded entity can, however,
claim to be the beneficial owner of a
payment if it is a hybrid entity claiming
treaty benefits. See Form W-8BEN-E and
its instructions for more information. If a
disregarded entity claims on a valid Form
W-8BEN-E to be the beneficial owner, the
U.S. withholding agent must complete a
Instructions for Form 1042-S (2015)

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Form 1042-S treating the disregarded
entity as a recipient and using recipient
code 26 (hybrid entity making a treaty
claim) as the chapter 3 status code and
the applicable recipient code for the
chapter 4 status code of the single owner
when the payment is a withholdable
payment and chapter 4 withholding does
not apply.
Amounts paid to a nonqualified intermediary or flow-through entity. If a
U.S. withholding agent makes a payment
to an NQI or a flow-through entity (other
than a nonparticipating FFI) with respect
to a withholdable payment, it must
complete a separate Form 1042-S for
each recipient on whose behalf the NQI or
flow-through entity acts as indicated by its
withholding statement and the
documentation associated with its Form
W-8IMY. If a payment is made through
tiers of NQIs or flow-through entities, the
withholding agent must nevertheless
complete Form 1042-S for the recipients
to which the payments are remitted. A
withholding agent completing Form
1042-S for a recipient that receives a
payment through an NQI or a flow-through
entity must include in boxes 15a through
15i of Form 1042-S the name, country
code, address, TIN, if any, and GIIN, if
any, of the NQI or flow-through entity from
whom the recipient directly receives the
payment.
If, however, a U.S. withholding agent
makes withholdable payments to an NQI
or a flow-through entity that is a
participating FFI or registered
deemed-compliant FFI that is allocable to
a chapter 4 withholding rate pool as
indicated by the FFI’s withholding
statement, the U.S. withholding agent
should complete a separate Form 1042-S
for each chapter 4 reporting pool (i.e., pool
of recalcitrant account holders, pool of
nonparticipating FFIs, pool of payees that
are U.S. persons) treating the participating
FFI or registered deemed-compliant FFI
as the recipient and must include the GIIN
of the FFI and the applicable chapter 4
reporting pool code as the chapter 4
status code. If a payment is made through
tiers of NQIs or flow-through entities that
are participating FFIs or registered
deemed-compliant FFIs, the withholding
agent must nevertheless complete Form
1042-S for each chapter 4 reporting pool
to which the payments are allocated and
must report, as the recipient, the FFI from
whom the recipients included in the
chapter 4 reporting pool directly receive
the payment.
Example. WA, a withholding agent,
makes a withholdable payment of interest
to FFI 1, a reporting model 1 FFI. FFI 1
provides WA with a valid Form W-8IMY
with which it associates a withholding
statement that allocates 80% of the
Instructions for Form 1042-S (2015)

payment to FFI 2, a participating FFI, and
20% of the payment to a pool of
nonparticipating FFIs. FFI 1 also provides
WA with FFI 2's Form W-8IMY with which
it associates a withholding statement that
allocates 100% of the payment to
recalcitrant pool-no U.S. indicia. WA must
complete a Form 1042-S for the interest
allocated to a pool of nonparticipating FFIs
with FFI 1 as the recipient and must
complete another Form 1042-S for the
interest allocated to a pool of recalcitrant
account holders-no U.S. indicia with FFI 2
as the recipient.
If a U.S. withholding agent makes
withholdable payments to an NQI or
flow-through entity that is a participating
FFI or deemed-compliant FFI, and cannot
reliably associate the payment, or any part
of the payment, with a withholding
statement, or to the extent required, a
valid withholding certificate (Forms W-8 or
W-9) or other valid appropriate
documentation from a recipient, the
withholding agent must follow the
appropriate presumption rules for that
payment. For this purpose, if the allocation
information provided to the withholding
agent indicates an allocation of more than
100% of the payment, then no part of the
payment should be considered to be
associated with a Form W-8, Form W-9, or
other appropriate documentation. The
Form 1042-S should be completed by
entering “Unknown Recipient” in box 13d
and recipient code 21 (unknown recipient)
as the chapter 3 status code and recipient
code 29 (unknown recipient) as the
chapter 4 status code. Also, the name,
country code, address, GIIN, if any, and
TIN, if any, of the FFI should be entered in
boxes 15a through 15i.
If a U.S. withholding agent makes
withholdable payments to an NQI or
flow-through entity that is a
nonparticipating FFI, the withholding agent
must treat the payment as made to an
unknown recipient regardless of whether it
can reliably associate the payment, or any
part of the payment, with a valid
withholding certificate (Forms W-8 or W-9)
or other valid appropriate documentation
from a recipient (see Regulations section
1.1471-3(d)(8)). The withholding agent
should complete a Form 1042-S showing
“Unknown Recipient” in box 13d and
recipient code 21 (unknown recipient) as
the chapter 3 status code and recipient
code 29 (unknown recipient) as the
chapter 4 status code. Also, the name,
country code, address, chapter 4 status,
and TIN, if any, of the nonparticipating FFI
should be entered on Form 1042-S in
boxes 15a through 15i.
If, however, an NQI or flow-through
entity that is a nonparticipating FFI
provides documentation described in
Regulations section 1.1471-3(d)(8)(ii) to
establish that the withholdable payment or
-11-

a portion of the payment is beneficially
owned by an exempt beneficial owner,
then the withholding agent should
complete a Form 1042-S for each exempt
beneficial owner showing the chapter 4
exemption code 15 (payee not subject to
chapter 4 withholding), the exempt
beneficial owner as the recipient in
box 13d, and the name, country code,
address, chapter 4 status, and TIN, if any,
of the nonparticipating FFI in boxes 15a
through 15i. For any remaining portion of
the payment, the withholding agent should
complete a Form 1042-S to an unknown
recipient as described directly above.
Pro-rata reporting. If the withholding
agent has agreed that an NQI (other than
a nonparticipating FFI) may provide
information allocating a payment to its
account holders under the alternative
procedure of Regulations section
1.1441-1(e)(3)(iv)(D) (no later than
February 14, 2016) and the NQI fails to
allocate more than 10% of the payment in
a withholding rate pool to the specific
recipients in the pool or an applicable
chapter 4 withholding rate pool, the
withholding agent must file Forms 1042-S
for each recipient in the pool on a pro-rata
basis. If, however, the NQI fails to timely
allocate 10% or less of the payment in a
withholding rate pool to the specific
recipients in a pool, the withholding agent
must file Forms 1042-S for each recipient
for which it has allocation information and
report the unallocated part of the payment
on a Form 1042-S in accordance with the
presumption rules.
Payments allocated, or presumed
made, to U.S. non-exempt recipients.
You may be given Forms W-9 or other
information regarding U.S. non-exempt
recipients from an NQI or flow-through
entity together with information allocating
all or a part of the payment to U.S.
non-exempt recipients. You must report
income allocable to a U.S. non-exempt
recipient on the appropriate Form 1099
and not on Form 1042-S, even though you
are paying that income to an NQI or a
flow-through entity. If, however, a
participating FFI or registered
deemed-compliant FFI provides a
withholding statement allocating all or part
of the payment to a chapter 4 withholding
rate pool of U.S. payees along with the
certification provided on Form W-8IMY
required for reporting such pool (as
described in Regulations section
1.1471-3(c)(3)(iii)(B)), you must report the
income allocable to such pool on Form
1042-S.
Example 4. FP is a nonwithholding
foreign partnership (flow-through entity)
that is a certified deemed-compliant FFI.
FP receives from WA, a U.S. withholding
agent, a withholdable payment of interest
described by income code 01 (interest

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paid by U.S. obligors – general). FP has
three partners, A, B, and C, all of whom
are individuals. FP provides WA with a
Form W-8IMY certifying that it is
transmitting Forms W-9 for U.S.
non-exempt recipients and Forms
W-8BEN from A and B and a Form W-9
from C, a U.S. non-exempt recipient. In
addition, FP provides a complete
withholding statement in association with
its Form W-8IMY that allocates the interest
payments among A, B, and C. WA must
file two Forms 1042-S, one each for A and
B, and a Form 1099-INT for C.
Example 5. The facts are the same as
in Example 4, except that FP does not
provide any documentation from its
partners. Because WA cannot reliably
associate the withholdable payment of
interest with documentation from a payee,
it must apply the presumption rules of
Regulations section 1.1471-3(f) to treat
the interest as paid to a nonparticipating
FFI. A Form 1042-S should be completed
by entering “Unknown Recipient” in
box 13d and recipient code 21 (unknown
recipient) as the chapter 3 status code and
recipient code 29 (unknown recipient) as
the chapter 4 status code. Also, the name,
country code, address, and TIN, if any, of
the certified deemed-compliant FFI should
be entered in box 15a through 15i.
Example 6. The facts are the same as
Example 5 except that FP is a participating
FFI and provides WA with a Form W-8IMY
certifying that it is reporting its U.S.
accounts under chapter 4 and a
withholding statement allocating 100% of
the payment to a pool of U.S. payees. WA
must file one Form 1042-S showing FP as
the recipient in box 13d and must include
FP's GIIN and recipient code 48 (U.S.
payees pool) as the chapter 4 status code.

Specified Federal Procurement
Payments Made to Foreign
Persons

For purposes of section 5000C, a payor of
a specified Federal procurement payment
to a foreign person must complete a Form
1042-S for payments withheld upon in the
name of the foreign person. Use income
code 44 to report payments subject to
withholding under section 5000C. Box 2
should include the amount of the specified
Federal procurement payments subject to
withholding and Box 7 should include the
amount of tax withheld under section
5000C.
If you are reporting tax withheld under
section 5000C, check box 3 as if the tax
were a chapter 3 tax, enter “00” in box 3a,
and report the tax withheld in box 3b. You
do not need to complete box 4a, 4b, or
any box for a chapter 3 or 4 status code.
On boxes 13d through 13g, include the
name and the address of the foreign

person withheld upon. If known, include
the TIN (if any) in box 13a.

Amounts Paid by
Qualified Intermediaries
In general. For purposes of chapter 4, a
QI must complete a Form 1042-S for
payments withheld under chapter 4
determined in accordance with the income
codes used to file Form 1042-S. A QI that
is a participating FFI or registered
deemed-compliant FFI may use the
chapter 4 pooled reporting codes 42
through 49 to allocate payments made to
its recalcitrant account holders, payees
that are nonparticipating FFIs, and payees
that are U.S. persons. A QI should not be
using chapter 4 reporting pool 49 (QI‐
Recalcitrant Pool‐ General) to report its
accounts but may use it to report accounts
maintained by another QI. A QI that is an
NFFE or an FFI treated as
deemed-compliant under an applicable
IGA (as described in Regulations section
1.1441-1(e)(5)(ii)(A)) may use chapter 4
reporting pool code 47 to report payments
allocable to a pool of nonparticipating
FFIs. QI may also use the chapter 4
pooled reporting codes to report payments
allocable to account holders, payees, or
owners of another participating FFI or
registered deemed-compliant FFI that is
an NQI, NWP, or NWT and provides its
chapter 4 withholding rate pools on its
withholding statement. In such case, the
QI must include the NQI, NWP, or NWT as
the recipient in box 13d. For payments
that are exempt from chapter 4
withholding, and made by the QI directly to
foreign beneficial owners (or that are
treated as paid directly to beneficial
owners), the QI may report on the basis of
chapter 3 reporting pools, in most cases.
A QI may not report on the basis of
reporting pools in the circumstances
described in Recipient-by-Recipient
Reporting, later. For payments not subject
to chapter 4 withholding, a QI may use a
single chapter 4 exemption code 15
(payee not subject to chapter 4
withholding) and a single chapter 3
reporting pool code 27 (Withholding rate
pool – general) as the chapter 3 status
code for all reporting pools, except for
amounts paid to foreign tax-exempt
recipients for which chapter 3 reporting
pool code 28 should be used. Note,
however, that a QI should use recipient
code 28 only for pooled account holders
that have claimed an exemption based on
their tax-exempt status and not some
other exemption (tax treaty or other Code).
Example 7. QI, a qualified
intermediary and participating FFI, has
four direct account holders, A and B,
foreign individuals, and X and Y, foreign
corporations. The withholdable payments
made to these direct account holders are
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exempt from chapter 4 withholding
because of the chapter 4 status of each
account holder. A and X are residents of a
country with which the United States has
an income tax treaty and have provided
documentation that establishes that they
are entitled to a lower treaty rate of 15%
on withholding of dividends from U.S.
sources. B and Y are not residents of a
treaty country and are subject to 30%
withholding on dividends. QI receives U.S.
source dividends on behalf of its four
customers. QI must file one Form 1042-S
for the 15% withholding rate pool. This
Form 1042-S must show income code 06
(dividends paid by U.S. corporations –
general) in box 1, “15.00” in box 3b
(chapter 3 tax rate), chapter 4 exemption
code 15 (payee not subject to chapter 4
withholding) in box 4a, “00.00” in box 4b
(chapter 4 tax rate), “Withholding rate
pool” in box 13d (recipient's name), and
chapter 3 reporting pool code 27
(withholding rate pool – general) as the
chapter 3 status code. QI also must file
one Form 1042-S for the 30% withholding
rate pool that contains the same
information as the Form 1042-S filed for
the 15% withholding rate pool, except that
it will show “30.00” in box 3b (chapter 3 tax
rate).
Example 8. The facts are the same as
in Example 7, except that Y is an
organization that has tax-exempt status in
the United States and in the country in
which it is located, and B is a recalcitrant
account holder with U.S. indicia. QI must
file three Forms 1042-S. One Form
1042-S (for amounts allocable for A and
X) will contain the same information as in
Example 7. The second Form 1042-S (for
amounts allocable to Y) will contain
information for the withholding rate pool
consisting of the amounts paid to Y. This
Form 1042-S will show income code 06
(dividends paid by U.S. corporations –
general) in box 1, exemption code 02
(exempt under IRC (other than portfolio
interest)) in box 3a, “00.00” in box 3b
(chapter 3 tax rate), chapter 4 exemption
code 15 (payee not subject to chapter 4
withholding) in box 4a, “00.00” in box 4b
(chapter 4 tax rate), “Zero rate withholding
pool-exempt organizations,” or similar
designation, in box 13d (recipient's name),
and chapter 3 code 28 (withholding rate
pool – exempt organization). The third
Form 1042-S will contain information for
the recalcitrant pool consisting of amounts
paid to B. This Form 1042-S will show
income code 06 (dividends paid by U.S.
corporations-general) in box 1, exemption
code 12 (payee subjected to chapter 4
withholding) in box 3a, “00.00” in box 3b
(tax rate), “00” in box 4a (chapter 4
exemption code), “30.00” in box 4b
(chapter 4 tax rate), “recalcitrant pool –
U.S. indicia” or similar designation, in
box 13d (recipient's name), and chapter 4
Instructions for Form 1042-S (2015)

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recipient code 43 (recalcitrant pool-U.S.
indicia) as the chapter 4 status code.
Under the terms of its Qualified
Intermediary (or QI) agreement
CAUTION
with the IRS, a QI that is an FFI
may be required to report the amounts
paid to U.S. non-exempt recipients on
Form 1099 or Form 8966 using the name,
address, and TIN of the payee to the
extent those items of information are
known. These amounts must be reported
on Form 1042-S if allocated to a chapter 4
withholding rate pool of U.S. payees.

!

Amounts Paid to Private
Arrangement Intermediaries

In most cases, a QI must report payments
made to each private arrangement
intermediary (PAI) (defined earlier in
Definitions) as if the PAI's direct account
holders were its own. For purposes of
chapter 4, a QI that is a participating FFI,
registered deemed-compliant FFI, or an
FFI treated as deemed-compliant under
an applicable IGA (as described in
Regulations section 1.1441-1(e)(5)(ii)(A))
may use the chapter 4 reporting pool code
47 to allocate payments made to the PAI's
payees that are nonparticipating FFIs, and
may treat the PAI as the recipient on Form
1042-S with respect to each such pool.
For chapter 3 purposes, if the payment is
made directly by the PAI to the recipient,
the QI may report the payment on a
pooled basis. A separate Form 1042-S is
required for each withholding rate pool of
each PAI. However, the QI must include
the name and address of the PAI and use
reporting pool code 29 or 30 (PAI
withholding rate pool – general and
PAI-withholding rate pool-exempt
organization) as the chapter 3 status code.
If the PAI is providing recipient information
from an NQI or flow-through entity, the QI
may not report the payments on a pooled
basis for chapter 3 purposes. Instead, it
must follow the same procedures as a
U.S. withholding agent making a payment
to an NQI or flow-through entity.
Example. QI, a qualified intermediary,
pays U.S. source dividends to direct
account holders that are foreign persons
and beneficial owners. It also pays a part
of the U.S. source dividends to two private
arrangement intermediaries, PAI1 and
PAI2. The private arrangement
intermediaries pay the dividends they
receive from QI to foreign persons that are
beneficial owners and direct account
holders of PAI1 or PAI2. All payees are
exempt from chapter 4 withholding and
the dividends paid are subject to a 15%
rate of withholding. QI must file a Form
1042-S for the dividends paid to its own
direct account holders that are beneficial
owners. QI also must file two Forms
1042-S, one for the dividends paid to the
direct account holders of each of PAI1 and

Instructions for Form 1042-S (2015)

PAI2. Each of the Forms 1042-S that QI
files for payments made to PAI1 and PAI2
must contain the name and address of
PAI1 or PAI2 and recipient code 29 (PAI
withholding rate pool – general) as the
chapter 3 status code.

Amounts Paid to
Certain Partnerships
and Trusts

A QI that is applying the special pool
reporting allowance provided in the QI
agreement for certain partnerships or
trusts (Joint Account or Agency Option)
must file separate Forms 1042-S reflecting
reporting pools for each partnership or
trust that has provided reporting pool
information in its withholding statement.
For purposes of chapter 4, a QI that is a
participating FFI or registered
deemed-compliant FFI may use the
chapter 4 reporting pool code 47 to
allocate payments made to the
partnership or trust's payees that are
nonparticipating FFIs, and may treat the
partnership or trust as the recipient on
Form 1042-S. For chapter 3 purposes, if
the payment is made directly by the
partnership or trust to the recipient, the QI
may use reporting pool code 31, 32, or 33
(Agency withholding rate pool – general,
Agency withholding rate pool-exempt
organization), and Joint Account
Withholding Rate Pool as the chapter 3
status code. However, to the extent
required in the QI agreement, the QI must
file separate Forms 1042-S for partners,
beneficiaries, or owners of such
partnership or trust that are indirect
partners, beneficiaries, or owners, and for
direct partners, beneficiaries, or owners of
such partnership or trust that are
intermediaries or flow-through entities.

Recipient-by-Recipient
Reporting

If a QI is not permitted to report on the
basis of reporting pools, it must follow the
same rules that apply to a U.S. withholding
agent. For chapter 3 purposes, a QI may
not report the following payments on a
reporting pool basis, but rather must
complete Form 1042-S for each
appropriate recipient and must provide the
applicable chapter 4 exemption code.
Payments made to another QI, QSL,
WP, or WT. The QI must complete a
Form 1042-S treating the other QI, QSL,
WP, or WT as the recipient.
Payments made to an NQI (including
an NQI that is an account holder of a
PAI). For chapter 3 purposes, the QI must
complete a Form 1042-S for each
recipient who receives the payment from
the NQI. A QI that is completing Form
1042-S for a recipient that receives a
payment through an NQI must include in
boxes 15a through 15i the name, country
-13-

code, address, TIN, if any, and GIIN, if
any, of the NQI from whom the recipient
directly receives the payment. In the case
of an NQI that is a participating FFI or
registered deemed-compliant FFI, the QI
must complete a Form 1042-S for the
chapter 4 withholding rate pool of the NQI
provided in a withholding statement
associated with its Form W-8IMY and
must report the NQI as the recipient. In
such a case, the QI must include the name
and address of the NQI as the recipient
and use chapter 4 pool reporting codes 42
through 49 as the chapter 4 status code. If
the NQI fails to provide sufficient allocation
information with respect to a withholdable
payment, the QI must complete a Form
1042-S with the recipient as "Unknown
Recipient" using reporting pool code 29
(unknown recipient) and must include the
NQI's information (name, address, country
code, TIN, if any, and GIIN) in boxes 15a
through 15i.
Example 1. QI, a qualified
intermediary, has NQI, a nonqualified
intermediary that is a participating FFI, as
an account holder. NQI has two account
holders, A and B, both recalcitrant account
holders with U.S. indicia who receive a
withholdable payment of U.S. source
dividends from QI. NQI provides QI with a
valid Form W-8IMY and a complete
withholding statement that allocates the
dividends paid to NQI to recalcitrant poolU.S. indicia for both A and B. QI must
complete one Form 1042-S reporting NQI
as the recipient and using reporting pool
code 42 (recalcitrant pool – U.S. indicia)
as the chapter 4 status code.
Example 2. QI has NQI, a
nonqualified intermediary that is a
reporting model 2 FFI, as an account
holder. NQI has two account holders, A
and B, who receive a withholdable
payment of U.S. source dividends from QI.
A is a nonparticipating FFI. NQI treats B as
a non-consenting U.S. account under the
applicable IGA and is not required to
withhold on payments to B under
chapter 4. NQI provides QI with a valid
Form W-8IMY and a complete withholding
statement that allocates 50% of the
dividends paid to A and 50% to B. NQI
designates B as a individual exempt from
withholding under an IGA but cannot
include B in a chapter 4 withholding rate
pool of U.S. payees because the payment
is subject to chapter 3 withholding and
under the presumption rules of
Regulations section 1.1441-1(b)(3) the
payment is presumed made to an
unknown, undocumented foreign payee.
QI must complete two Forms 1042-S. One
Form 1042-S showing NQI as the recipient
and using reporting pool code 47
(nonparticipating FFI pool). The second
Form 1042-S showing the recipient as
“Unknown Recipient” and NQI in
box 15a-15i with chapter 4 exemption

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code 19 (exempt from withholding under
IGA) and 30% withholding under chapter 3
for the payment allocated to B as a
presumed foreign person under chapter 3.
Payments made to a flow-through entity. The QI must complete a Form 1042-S
for each recipient who receives the
payment from the flow-through entity. A QI
that is completing a Form 1042-S for a
recipient that receives a payment through
a flow-through entity must include in boxes
15a through 15i the name, country code,
address, GIIN, if any, and TIN, if any, of
the flow-through entity from which the
recipient directly receives the payment.
For chapter 4 purposes and in the case
of a flow-through entity that is a
participating FFI or registered
deemed-compliant FFI (other than a WP
or WT), the QI must complete a Form
1042-S for each chapter 4 withholding rate
pool provided in the withholding statement
associated with the Form W-8IMY of the
flow-through entity. The QI must include
the name, address, and GIIN of the
flow-through entity as the recipient and
use pooled reporting codes 42 through 49
as the chapter 4 status code.
Example. QI, a qualified intermediary,
has FP, a nonwithholding foreign
partnership that is a registered
deemed-compliant FFI, as an account
holder. QI pays interest that is a
withholdable payment described by
income code 01 (interest paid by U.S.
obligors – general) to FP. FP has three
partners, A, B, and C, all of whom are
exempt from withholding under chapter 4.
FP provides QI with a Form W-8IMY with
which it associates the Forms W-8BEN
from each of A, B, and C. In addition, FP
provides a complete withholding
statement in association with its Form
W-8IMY that allocates the interest
payments among A, B, and C. QI must file
three Forms 1042-S, one each for A, B,
and C. The Forms 1042-S must show
information relating to FP in boxes 15a
through 15i along with the chapter 4 status
and exemption code for A, B, and C.

Amounts Paid by
Withholding Foreign
Partnerships and Trusts
In general. For chapter 4 purposes,
payments that are made by a withholding
foreign partnership (WP) or withholding
foreign trust (WT) that is an FFI directly to
its partners, owners, or beneficiaries that
are recalcitrant account holders, payees
that are nonparticipating FFIs, and payees
that are U.S. persons may be reported on
the basis of chapter 4 reporting pools. A
WP or WT may also use the chapter 4
pooled reporting codes to report payments
allocable to account holders, payees, or
owners of another participating FFI or
registered deemed-compliant FFI that is

an NQI, NWP, or NWT and provides its
chapter 4 withholding rate pools on its
withholding statement when the WP or WT
applies section 9.03 of its Agreement to
such entity. In such case, the WP or WT
must include the NQI, NWP, or NWT as
the recipient in box 13d. If a WP or WT
has not made a pooled reporting election,
for chapter 3 purposes, a WP or WT must
file a separate Form 1042-S for each
direct partner, beneficiary, or owner that is
exempt from chapter 4 withholding and to
whom the WP or WT distributes, or in
whose distributive share is included, an
amount subject to withholding under
chapter 3, in the same manner as a U.S.
withholding agent. However, if the WP or
WT has made a pooled reporting election
in its WP or WT agreement, the WP or WT
may instead report payments to such
direct partners, beneficiaries, or owners
on the basis of chapter 3 reporting pools
and file a separate Form 1042-S for each
reporting pool. For payments not subject
to chapter 4 withholding, a WP or WT may
use a single chapter 4 exemption code 15
(payee not subject to chapter 4
withholding) and a single chapter 3
reporting pool code 27 (withholding rate
pool – general) as the chapter 3 status
code for all chapter 3 reporting pools,
except for amounts paid to foreign
tax-exempt recipients for which a separate
recipient code 28 must be used. For this
purpose, a foreign tax-exempt recipient
includes any organization that is not
subject to withholding and is not liable to
tax in its country of residence because it is
a charitable organization, pension fund, or
foreign government. See the WP and WT
agreements for when a WP and WT can
pool report payments to an indirect
partner, beneficiary, or owner. See section
9 of the WP or WT Agreement.

Amounts Paid
by Nonqualified
Intermediaries and
Flow-Through Entities

An NQI and a flow-through entity are
withholding agents and must file Forms
1042-S for amounts paid to recipients.
However, an NQI or flow-through entity is
not required to file Form 1042-S if it is not
required to file Form 1042-S under the
Multiple Withholding Agent Rule, later. An
NQI or flow-through entity may report
payments made to recipients to the extent
it has failed to provide to another
withholding agent the appropriate
documentation and complete withholding
statement for either chapter 3 or 4
purposes. If the NQI or flow-through entity
chooses to or must file Form 1042-S, as
described above, the NQI or flow-through
entity must also file Form 1042 and, if
applicable, attach the Form 1042-S it
received from the withholding agent to
-14-

establish any credit for amounts withheld
by the withholding agent. See Instructions
for Form 1042.
If another withholding agent has
withheld tax on an amount that should
have been exempt (for example, where
the withholding agent applied the
presumption rules because it did not
receive proper documentation or other
required information from the NQI or
flow-through entity), and the payee or
beneficial owner will make a claim for
refund, the NQI or flow-through entity must
report on Form 1042-S the correct tax rate
and the combined amount of U.S. federal
tax withheld with respect to the recipient
and should enter the applicable chapter 3
and 4 exemption codes.
If another withholding agent
underwithholds, even though it received
proper documentation from the NQI or
flow-through entity, the NQI or
flow-through entity must withhold
additional amounts to bring the total
withholding to the correct amount.

Multiple Withholding
Agent Rule

A withholding agent is not required to file
Form 1042-S if a return is filed by another
withholding agent reporting the same
amount and the withholding agent has
withheld correctly.
The multiple withholding agent rule
does not relieve withholding agents from
Form 1042-S reporting responsibility in the
following circumstances.

Any withholding agent making a
payment to a QI, QSL, WP, or WT must
report that payment as made to the QI,
QSL, WP, or WT.
Any withholding agent making a
payment to a U.S. branch treated as a
U.S. person must report the payment as
made to that branch.
Any withholding agent that withholds an
amount from a payment under chapters 3
or 4 must report that amount to the
recipient from whom it was withheld.
Furthermore, the multiple withholding
agent rule does not relieve the following
from Form 1042-S reporting responsibility.
Any QI, WP, or WT required to report an
amount to chapter 4 withholding rate pool
or chapter 3 withholding rate pool.
An NQI or flow-through entity that
knows, or has reason to know, that the
correct amount has not been withheld by
another withholding agent. A withholding
agent reporting amounts withheld by
another withholding agent must use box 8
“tax withheld by other agents” to report
such amounts and must provide the name
and EIN of the withholding agent that
withheld in boxes 14a and 14b “Primary
Withholding Agent.”
Instructions for Form 1042-S (2015)

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Example 1. NQI, a foreign bank that is
a participating FFI, acts as a nonqualified
intermediary for four different foreign
persons (A, B, C, and D) who own
securities from which they receive interest
that is a withholdable payment. The
interest is paid by a U.S. withholding agent
(WA) as custodian of the securities for
NQI. A, B, C, and D each own a 25%
interest in the securities. NQI has
furnished WA a Form W-8IMY to which it
certifies its status as a participating FFI
and has attached Forms W-8BEN from A
and B. NQI's Form W-8IMY contains an
attachment stating that 25% of the
securities are allocable to each of A and
B, and 50% to a pool of recalcitrant
account holders with U.S. indicia. WA
pays $100 of interest during the calendar
year. WA treats the $25 of interest
allocable to A and the $25 of interest
allocable to B as portfolio interest and
completes Forms 1042-S for A and for B
as the recipients. WA includes information
relating to NQI in boxes 15a through 15i
on the Forms 1042-S for A and B. WA
subjects the remaining $50 of interest to
30% withholding under chapter 4 and
reports the interest on a Form 1042-S by
treating NQI as the recipient in box 13d
(using reporting pool code 43 (recalcitrant
pool – U.S. indicia) as the chapter 4 status
code, “30.00” in box 4b (chapter 4 tax
rate), and $15 as the amount withheld in
box 7 and box 10. Under the multiple
withholding agent rule, NQI is not required
to file a Form 1042-S, but must file a Form
1042-S if, for example, C and D seek to
make a claim for refund and NQI has not
filed a collective refund claim on behalf of
C and D for the tax withheld under
chapter 4 on the payment (see
Regulations section 1.1471-4(h)).
Example 2. WA, a U.S. withholding
agent, makes a $100 dividend payment
that is a withholdable payment to a foreign
bank (NQI) that is a participating FFI and
acts as a nonqualified intermediary. NQI
receives the payment on behalf of A,
documented as a foreign individual
exempt from chapter 4 withholding and a
resident of a treaty country who is entitled
to a 15% rate of withholding under
chapter 3, and B, documented as a
foreign individual exempt from chapter 4
withholding and a resident of a country
that does not have a tax treaty with the
United States and who is subject to 30%
withholding under chapter 3. NQI provides
WA with its Form W-8IMY that certifies its
status as a participating FFI to which it
associates the Forms W-8BEN from both
A and B and a complete withholding
statement that allocates 50% of the
dividend to A and 50% to B. A's Form
W-8BEN claims a 15% treaty rate of
withholding. B's Form W-8BEN does not
claim a reduced rate of withholding. WA,
however, mistakenly withholds only 15%,
Instructions for Form 1042-S (2015)

$15, from the entire $100 payment. WA
completes a Form 1042-S for each A and
B as the recipients, showing on each form
$50 of dividends in box 2, a withholding
rate of “15.00” in box 3b (chapter 3 tax
rate), and $7.50 as the amount withheld in
boxes 7 and 10. Under the multiple
withholding agent rule, NQI is not required
to file a Form 1042-S for A. However,
because NQI knows (or should know) that
B is subject to a 30% rate of withholding,
and assuming it knows that WA only
withheld 15%, the multiple withholding
agent rule does not apply to the dividend
paid to B, and NQI must withhold an
additional 15% from the payment to B.
NQI then must file a Form 1042-S for B
showing $50 of dividends in box 2, “00” in
box 3a (chapter 3 exemption code),
“30.00” in box 3b (the correct chapter 3 tax
rate), $7.50 withheld by NQI in box 7,
$7.50 withheld by WA in box 8, and $15 in
box 10 (the combined amount withheld).
NQI also must enter chapter 4 exemption
code 15 (payee not subject to chapter 4
withholding) in box 4a and “00.00” in
box 4b (chapter 4 tax rate). See the
instructions for box 3a, later.

Penalties

The following penalties apply to the
person required to file Form 1042-S. The
penalties apply to both paper filers and
electronic filers.
Late filing of correct Form 1042-S. A
penalty may be imposed for failure to file
each correct and complete Form 1042-S
when due (including extensions), unless
you can show that the failure was due to
reasonable cause and not willful neglect.
The penalty, based on when you file a
correct Form 1042-S, is:
$30 per Form 1042-S if you correctly file
within 30 days after the required filing
date; the maximum penalty is $250,000
per year ($75,000 for a small business). A
small business, for this purpose, is defined
as having average annual gross receipts
of $5 million or less for the 3 most recent
tax years (or for the period of its existence,
if shorter) ending before the calendar year
in which the Forms 1042-S are due.
$60 per Form 1042-S if you correctly file
more than 30 days after the due date but
by August 1; the maximum penalty is
$500,000 per year ($200,000 for a small
business).
$100 per Form 1042-S if you file after
August 1 or you do not file correct Forms
1042-S; the maximum penalty is
$1,500,000 per year ($500,000 for a small
business).
If you intentionally disregard the
requirement to report correct information,
the penalty per Form 1042-S is increased
to the greater of $250 or 10% of the total
amount of items required to be reported,
with no maximum penalty.
-15-

Failure to furnish correct Form 1042-S
to recipient. If you fail to provide
statements to recipients and cannot show
reasonable cause, a penalty of up to $100
may be imposed for each failure to furnish
Form 1042-S to the recipient when due.
The penalty also may be imposed for
failure to include all required information or
for furnishing incorrect information on
Form 1042-S. The maximum penalty is
$1,500,000 for all failures to furnish
correct recipient statements during a
calendar year. If you provide the correct
statement on or before August 1, reduced
penalties similar to those for failing to file a
correct Form 1042-S with the IRS may be
imposed. See Late filing of correct Form
1042-S., earlier. If you intentionally
disregard the requirement to report correct
information, each $100 penalty is
increased to the greater of $250 or 10% of
the total amount of items required to be
reported, with no maximum penalty.
Failure to file electronically. If you are
required to file electronically but fail to do
so, and you do not have an approved
waiver on record, penalties may apply
unless you establish reasonable cause for
your failure.

Avoid Common Errors

To ensure that your Forms 1042-S can be
correctly processed, be sure that you:
Carefully read the information provided
in Pub. 515 and these instructions.
Comply with the requirements in Pub.
1187 if you are an electronic filer.
Complete all required fields. At a
minimum, you must enter information in
boxes 1, 2, 7, 12a-f, 12d, 12h-i, and 13d.
Other boxes must be completed if the
nature of the payment requires it.
If the amount reported in box 2 is a
withholdable payment, you must enter
information in boxes 4a, 4b, 12c, and 13c.
If the amount reported in box 2 is an
amount subject to chapter 3 withholding,
you must enter information in boxes 12b
and 13b.
If you use chapter 4 exemption code 15,
17, 18, 19, or 20, you must provide a
chapter 4 status code for the recipient
(box 13c).
If the amount reported in box 2 is a
withholdable payment and an amount
subject to chapter 3 withholding and the
tax rate in box 4b is 00.00, you must enter
information in boxes 3a and 3b. If the
amount entered in box 4b is 30.00, you
may enter information in boxes 3a and 3b.
If you are a QI, WP, or WT that is pool
reporting for its direct account holders only
a chapter 3 (box 13b) or chapter 4 status
code (box 13c) is required.
If the recipient in box 13d or entity in
box 15d is a participating FFI, registered
deemed-compliant FFI, sponsored FFI,
direct reporting NFFE, or sponsored direct

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reporting NFFE, you must enter the
entity's GIIN or the GIIN of the sponsoring
entity in box 13h or 15e.
Note. You may leave box 3b or 4b blank if
you are reporting a payment to an artist or
athlete and there is a central withholding
agreement. See Exception for central
withholding agreements in the instructions
for boxes 3b or 4b.
Use only income, status, exemption,
and country codes specifically listed in
these instructions.
Use only tax rates that are allowed by
statute, regulations, or treaty. Do not
attempt to “blend” rates. Instead, if
necessary, submit multiple Forms 1042-S
to show changes in tax rate. See the Valid
Tax Rate Table, later.
All information you enter when
reporting the payment must correctly
reflect the intent of the statute and
regulations. In most cases, you should rely
on the withholding documentation you
have collected (Form W-8 series, Form
8233, etc.) to complete your Form 1042-S
submissions.
Also note the following:
The gross income you report in box 2
cannot be zero.
The income code you report in box 1
must correctly reflect the type of income
you pay to the recipient.
The withholding agent's name, address,
status codes, EIN, QI-EIN, WP-EIN,
WT-EIN, and GIIN, if any, must be
reported in boxes 12a-i.
The recipient's name, address, U.S.
TIN, if any, GIIN, if any, and country code
must be reported in boxes 13a, and 13d-h.
In most cases, you must report a foreign
address. See the instructions for box 13,
later.
The country code that you report in
boxes 13e and 15f must be present and
correctly coded and cannot be “US.”
Additionally, do not use “OC” or “UC”
except as specifically allowed in these
instructions.
For direct account holders, you must
report the recipient's account number in
box 16. You may also be required to report
the recipient's foreign TIN and date of birth
in boxes 13i and 17 (see instructions for
boxes 13i and 17, later).
The exemption code you report in
box 3a must correctly identify the proper
tax status for the type of income you pay
to the recipient. The exemption code you
report in box 4a must correctly identify the
proper tax status for the type of income
you pay to the recipient or if exemption
code 15 is used (payee not subject to
chapter 4 withholding), the chapter 4
status code of the recipient must correctly
reflect this exemption.
Note. If you use exemption code 04
(exempt under tax treaty), the country

code that you report in box 13e must be a
valid treaty country. Countries with which
the United States has a tax treaty are
shown in bold italics in the country code
list, later.
You, the withholding agent, are
liable for the tax if you know, or
CAUTION
should have known, that
underwithholding on a payment has
occurred.

!

Specific Instructions for
Withholding Agents

!

All amounts must be reported in
U.S. dollars.

CAUTION

Rounding Off
to Whole Dollars

You may round off cents to whole dollars.
If you do round to whole dollars, you must
round all amounts. To round off amounts
to the nearest whole dollar, drop amounts
under 50 cents and increase amounts
from 50 to 99 cents to the next dollar. For
example, $1.39 becomes $1 and $2.50
becomes $3. If you have to add two or
more amounts to figure the amount to
enter on a line, include cents when adding
and only round off the total.

Amended Checkbox

See Amended Returns, later.

Pro-rata Basis Reporting
Checkbox

Withholding agents must check this box to
notify the IRS that an NQI that used the
alternative procedures of Regulations
section 1.1441-1(e)(3)(iv)(D) failed to
properly comply with those procedures.
See Pro-rata reporting, earlier, for
additional information.

Box 1, Income Code

All filers must enter the appropriate 2-digit
income code from the list, earlier. Use the
income code that is the most specific. See
Pub. 515 for further explanation of the
income codes. Below are examples on
how to use some of the income codes.
1. Use code 09 for the following types
of capital gain:
a. Gains on disposal of timber, coal,
or domestic iron ore with a retained
economic interest, unless an election is
made to treat those gains as income
effectively connected with a U.S. trade or
business;
b. Gains on contingent payments
received from the sale or exchange after
October 4, 1966, of patents, copyrights,
secret processes and formulas, goodwill,
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trademarks, trade brands, franchises, and
other like property;
c. Gains on certain transfers of all
substantial rights to, or an undivided
interest in, patents if the transfers were
made before October 5, 1966; and
d. Certain gains from the sale or
exchange of original issue discount
obligations issued after March 31, 1972.
2. Use code 17 for payments for
personal services performed by an
independent contractor as contrasted with
those performed by an employee. This
includes payments that are subject to the
business profits article of a treaty.
3. Use code 29 (deposit interest) if
you are paying bank deposit interest, not
code 01 (interest paid by U.S.
obligors-general).
4. Use code 24 (real estate
investment trust (REIT) distributions of
capital gains) for distributions of capital
gains from a real estate investment trust
(REIT). Use code 36 (capital gains
distributions) for capital gain distributions
(dividends) paid or credited by mutual
funds (or other regulated investment
companies). Include short-term capital
gain dividends (use exemption code 02
(exempt under IRC (other than portfolio
interest)) in box 3a).
Note. Exempt-interest dividends should
be reported under income code 01
(interest paid by U.S. obligors-general)
(use exemption code 02 (exempt under
IRC (other than portfolio interest)) in
box 3a).
5. Use code 28 for gambling
winnings. These are proceeds from a
game other than blackjack, baccarat,
craps, roulette, or big-6 wheel. For more
information, see Pub. 515.
6. Use code 33, 34, or 35 for all
substitute payment transactions. For more
information, see Regulations sections
1.861-2(a)(7) and 1.861-3(a)(6) and
Notice 2010-46.
7. Use code 37 (return of capital) for a
nondividend distribution. This is a
distribution that is not paid out of the
earnings and profits of a corporation. It
represents a distribution in part or full
payment in exchange for stock.
8. Use code 40 (other dividend
equivalents under IRC section 871(m)
(formerly 871(l))) for other U.S.-source
dividend equivalents. These are dividend
equivalent payments under section
871(m) that are not substitute dividend
payments identified with income code 34.
9. Use code 41 (guarantee of
indebtedness) for certain guarantee of
indebtedness payments. These are
amounts paid for the provision of a
guarantee of indebtedness that was
issued after September 27, 2010.
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Income Codes
Box 1.

Enter the appropriate income code.

Code

16

Scholarship or fellowship grants

17
18
19
20
23
24

Compensation for independent personal services2
Compensation for dependent personal services2
Compensation for teaching2
Compensation during studying and training2
Gross income – Other
Real estate investment trust (REIT) distributions of capital gains

29
30

Interest paid by U.S. obligors – general
Interest paid on real property mortgages
Interest paid to controlling foreign corporations
Interest paid by foreign corporations
Interest on tax-free covenant bonds
Interest paid on deposit with a foreign branch of a
domestic corporation or partnership
Deposit interest
Original issue discount (OID)

25
26

31

Short-term OID

27

33
51

28

Code

Substitute payment – interest
Interest paid on certain actively traded or publicly offered
securities1
Dividend Income

Trust distributions subject to IRC section 1445
Unsevered growing crops and timber distributions by a trust
subject to IRC section 1445
Publicly traded partnership distributions subject to IRC section
1446
Gambling winnings3

06
07
08

Dividends paid by U.S. corporations – general
Dividends qualifying for direct dividend rate
Dividends paid by foreign corporations

32
35
36
37
38

21

Gross income-Capital gain dividend

39

34
40

Substitute payment – dividends
Other dividend equivalents under IRC section 871(m)
(formerly 871(l))
Dividends paid on certain actively traded or publicly
offered securities1
Substitute payments‐ dividends from certain actively
traded or publicly offered securities 1

41
42

01
02
03
04
05
22

52
53
Code
09
10
11
12
13
14
15

Interest Income

Other Income
Capital gains
Industrial royalties
Motion picture or television copyright royalties
Other royalties (for example, copyright, recording,
publishing)
Royalties paid on certain publicly offered securities1
Real property income and natural resources royalties
Pensions, annuities, alimony, and/or insurance premiums

Notional principal contract income4
Substitute payment – other
Capital gains distributions
Return of capital
Eligible deferred compensation items subject to IRC section
877A(d)(1)
Distributions from a nongrantor trust subject to IRC section 877A(f)
(1)
Guarantee of indebtedness
Earnings as an artist or athlete – no central withholding
agreement5

43

Earnings as an artist or athlete – central withholding agreement5

44
50
54

Specified Federal procurement payments
Income previously reported under escrow procedure6
Other income

1
This code should only be used if the income paid is described in §1.1441‐6(c)(2) and withholding agent has reduced the rate of withholding under
an income tax treaty without the recipient providing a U.S. or foreign TIN.

If compensation that otherwise would 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.
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
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).
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.
2
3

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Exemption Codes and Recipient Codes
Boxes 3a
and 4a.

Exemption code (applies if the tax rate entered in
boxes 3b and 4b is 00.00).

04

Territory FI – not treated as U.S. Person

Code

Authority for Exemption

05

U.S. branch of Participating FFI – treated as U.S. Person

06

U.S. branch – not treated as U.S. Person

07
08
09
10
11
12
13
14
15
16
17
18

U.S. branch – ECI presumption applied
Partnership other than Withholding Foreign Partnership
Withholding Foreign Partnership
Trust other than Withholding Foreign Trust
Withholding Foreign Trust
Qualified Intermediary
Qualified Securities Lender – Qualified Intermediary
Qualified Securities Lender – Other
Corporation
Individual
Estate
Private Foundation

19
20
21
22
23
24
25

Government or International Organization
Tax Exempt Organization (Section 501(c) entities)
Unknown Recipient
Artist or Athlete
Pension
Foreign Central Bank of Issue
Nonqualified Intermediary

26

Hybrid entity making Treaty Claim

Chapter 3
01
02
03
04
05
06
07
08
09
10
11
12

Effectively connected income
Exempt under IRC (other than portfolio interest)
Income is not from U.S. sources
Exempt under tax treaty
Portfolio interest exempt under IRC
QI that assumes primary withholding responsibility
WFP or WFT
U.S. branch treated as U.S. Person
Territory FI treated as U.S. Person
QI represents that income is exempt
QSL that assumes primary withholding responsibility
Payee subjected to chapter 4 withholding

Chapter 4
13
14
15
16
17
18
19
20
21
22

Grandfathered payment
Effectively connected income
Payee not subject to chapter 4 withholding
Excluded nonfinancial payment
Foreign Entity that assumes primary withholding
responsibility
U.S. Payees – of participating FFI or registered
deemed-compliant FFI
Exempt from withholding under IGA7
Dormant account8
Excluded payment on offshore obligation
Excluded Payments on Collateral9

Code

Type of Recipient, Withholding Agent, or
Intermediary

Chapter 3

Status Codes
Pooled Reporting Codes 10

01
02
03

U.S. Withholding Agent – FI
U.S. Withholding Agent – Other
Territory FI treated as U.S. Person

27
28
29
30
31
32
33

Withholding Rate Pool – General
Withholding Rate Pool – Exempt Organization
PAI Withholding Rate Pool – General
PAI Withholding Rate Pool – Exempt Organization
Agency Withholding Rate Pool – General
Agency Withholding Rate Pool – Exempt Organization
Joint Account Withholding Rate Pool

7

Use only to report a U.S. reportable account or non-consenting U.S. account that is receiving a payment subject to chapter 3 withholding.

8

Use only if applying the escrow procedure for dormant accounts under 1.1471‐4(b)(6). If tax is withheld and deposited under chapter 3, do not
check box “Check if tax not deposited with IRS pursuant to escrow procedure” and you must check box 3 and complete box 3b.

9

This code should only be used if the income paid is not subject to withholding under chapter 4 pursuant to 1.1473‐1(a)(4)(vii).

10

These codes should only be used by a QI, QSL, WP, or WT.

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Recipient Codes (continued)
Code

Type of Recipient, Withholding Agent, or
Intermediary
Chapter 4 Status Codes

25

Excepted Territory NFFE

26

Excepted NFFE – Other

01
02
03
04
05
06
07

27
28
29
30
31
32
33

Exempt Beneficial Owner
Entity Wholly Owned By Exempt Beneficial Owners
Unknown Recipient
Recalcitrant Account Holder
Nonreporting IGA FFI
Direct reporting NFFE
U.S. reportable account

34
35
36
37

Non – consenting U.S. account
Sponsored direct reporting NFFE
Excepted Inter-affiliate FFI
Undocumented Preexisting Obligation

38

US branch – ECI presumption applied

39
40

Account Holder of Excluded Financial Account 11
Passive NFFE reported by FFI 12

08
09
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24

U.S. Withholding Agent – FI
U.S. Withholding Agent – Other
Territory FI –not treated as U.S. Person
Territory FI – treated as U.S. Person
Participating FFI – Other
Participating FFI – Reporting Model 2 FFI
Registered Deemed-Compliant FFI – Reporting Model 1
FFI
Registered Deemed-Compliant FFI – Sponsored Entity
Registered Deemed-Compliant FFI – Other
Certified Deemed-Compliant FFI – Other
Certified Deemed-Compliant FFI – FFI with Low Value
Accounts
Certified Deemed-Compliant FFI – Non-Registering Local
Bank
Certified Deemed-Compliant FFI – Sponsored Entity
Certified Deemed-Compliant FFI – Investment Advisor or
Investment Manager
Nonparticipating FFI
Owner-Documented FFI
Limited Branch treated as Nonparticipating FFI
Limited FFI treated as Nonparticipating FFI
Passive NFFE identifying Substantial U.S. Owners
Passive NFFE with no Substantial U.S. Owners
Publicly Traded NFFE or Affiliate of Publicly Traded NFFE
Active NFFE
Individual
Section 501(c) Entities

41
NFFE subject to 1472 withholding
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‐General 13

11
This code should only be used if income is paid to an account that is excluded from the definition of financial account under 1.1471‐5(b)(2) or
under Annex II of the applicable Model 1 IGA or Model 2 IGA.
12
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 box 15d and 15e.
13
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.

Instructions for Form 1042-S (2015)

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10. Use either code 42 (earnings as an
artist or athlete – no central withholding
agreement) or 43 (earnings as an artist or
athlete – central withholding agreement)
for payments to an artist or athlete. A
central withholding agreement is Form
13930, Application for Central Withholding
Agreement, plus additional information
specified in the instructions to such form,
that is entered into by the artist or athlete,
a designated withholding agent, and the
IRS. For more details, see Pub. 515.
11. Use code 50 (income previously
reported under escrow procedure) with
respect to a recalcitrant account holder of
a dormant account for which a
participating FFI reported the income on
Form 1042-S in a prior calendar year but
for which the participating FFI was not
required to deposit the tax withheld or
determined that withholding was not
required until the current calendar year
under an applicable escrow procedure.
For additional information on the escrow
procedure for dormant accounts, see
Regulations section 1.1471-4(b)(6). Use
code 52 (dividends paid on certain
actively traded or publicly offered
securities), 53 (substitute paymentsdividends paid from certain actively traded
or publicly offered securities), 51 (interest
paid on certain actively traded or publicly
offered securities), and 13 (royalties paid
on certain publicly offered securities) if the
income paid is described in Regulations
section 1.1441-6(c)(2) and you have
reduced the rate of withholding under an
income tax treaty without the recipient
providing a U.S. or foreign TIN.
If you paid more than one type of income
to or on behalf of the same recipient, you
must complete a separate Form 1042-S,
Copy A, for each income type.
Note. Although income codes are
provided for short-term OID and notional
principal contract income, those items are
not always subject to reporting on Form
1042-S. For example, short-term OID may
need to be reported by an NQI or
flow-through entity if those amounts are
paid to foreign persons and another
withholding agent backup withheld on
those amounts under the presumption
rules. Notional principal contract income is
reportable if it is effectively connected with
the conduct of a trade or business in the
United States or results in the payment of
interest under Regulations section
1.446-3(g)(4) or a dividend equivalent
under section 871(m)) and the regulations
thereunder. For more information, see the
regulations under chapter 3 and Pub. 515.

Box 2, Gross Income

For each income type, enter the gross
amount you paid to or on behalf of the
recipient during calendar year 2015,

including withheld tax. The following
special procedures apply to the reporting
of gross income.
You must report the entire amount of a
corporate distribution made with respect
to stock even if you elect to reduce the
amount of withholding on the distribution
because all or a part of the distribution is
nontaxable or represents a capital gain
dividend.
You must report the entire amount of a
payment if you do not know at the time of
payment the amount that is subject to
withholding because the determination of
the source of the income or the calculation
of the amount of income subject to tax
depends upon facts that are not known at
the time of payment.
If you applied the escrow procedure
under chapters 3 and 4, report the entire
amount of a payment that you previously
reported in a prior calendar year for which
you withheld tax but did not deposit such
tax under the escrow procedure if the
liability is due in the current calendar year.
You must report the entire amount of
gains relating to the disposal of timber,
coal, or domestic iron ore with a retained
economic interest and gains relating to
contingent payments received from the
sale or exchange of patents, copyrights,
and similar intangible property.
You must report only the amount of
cash paid on notional principal contracts.

Boxes 3 and 4

If you are reporting amounts in boxes 7
through 9, check either box 3 or box 4 to
indicate whether the amounts were
withheld (or assumed by the withholding
agent) pursuant to chapter 3 (box 3) or
chapter 4 (box 4). If you are reporting tax
withheld under section 5000C, check
box 3 as if the tax were a chapter 3 tax.
Note. Either box 3 or box 4 must be
checked on each Form 1042-S, not both
boxes. If you are not reporting amounts in
boxes 7 through 9 because you did not
withhold under chapter 3 or 4, you should
check box 3.

Boxes 3a and 4a, Exemption
Code

In most cases, if the tax rate you entered
in box 3b or 4b is 00.00, you should enter
the appropriate exemption code (01
through 22) from Income Codes,
Exemption Codes, and Recipient,
Withholding Agent, or Intermediary
Codes, earlier, as applicable for chapter 3
and 4 purposes. In certain cases more
than one exemption code will apply; see
below instructions for the applicable codes
to determine which code to use.
If an amount was withheld under
chapter 4 (the tax rate you entered in
box 4b is greater than zero and is not due
to backup withholding), enter “00” in
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box 4a. If an amount was withheld under
chapter 3 (the tax rate you entered in
box 3b is greater than zero and is not due
to backup withholding), enter “00” in
box 3a. If the tax rate you entered in
box 3b is due to backup withholding, leave
box 3a blank.
If exemption code 01 or 14 (effectively
connected income) applies, you must
enter the recipient's U.S. TIN in box 13a if
you relied on a presumption rule to treat
the income as effectively connected with a
U.S. trade or business. If the recipient's
U.S. TIN is unknown or unavailable, you
must withhold tax at the rate of 30%
(30.00) and enter “00” in box 4b or 3b (as
applicable).
A withholding agent should use
exemption code 06 (QI that assumes
primary withholding responsibility) only if it
is making a payment to a QI that has
represented on its Form W-8IMY that it is
assuming primary withholding
responsibility under chapters 3 and 4.
A withholding agent should use
exemption code 07 (WP or WT) only if it is
making a payment to a foreign partnership
or trust that has represented on its Form
W-8IMY that it is a withholding foreign
partnership or trust.
A withholding agent should use
exemption code 08 (U.S. branch treated
as U.S. person) or 09 (territory FI treated
as U.S. person) (as applicable) only if it is
making a payment to a U.S. branch or to
territory FI and it has represented on its
Form W-8IMY that it agrees to be treated
as a U.S. person.
A withholding agent should use
exemption code 10 (QI represents that
income is exempt) only if it makes a
payment to a QI that has not assumed
primary withholding responsibility under
chapters 3 and 4 or primary backup
withholding responsibility, but has
represented on a withholding statement
associated with its Form W-8IMY that the
income is exempt from withholding.
A withholding agent should use
exemption code 11 (QSL that assumes
primary withholding responsibility) only if
the withholding agent makes a substitute
dividend payment to a financial institution
(including a QI) that represented on its
Form W-8IMY that is acting as a QSL for
the account associated with the form.
A withholding agent should use
exemption code 12 (payee subjected to
chapter 4 withholding) if the recipient is
subject to chapter 4 withholding and thus
chapter 3 withholding does not apply. See
Special Instructions for use of Chapter 3
Exemption Codes, later.
A withholding agent should use
exemption code 13 (grandfathered
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payment) only if the withholding agent
makes a payment under a grandfathered
obligation and exemption code 13 is the
only exemption code that applies. If
another exemption code applies, it should
be used instead of exemption code 13.
A withholding agent should use
exemption code 15 (payee not subject to
chapter 4 withholding) if the payment is a
withholdable payment (as defined in
Regulations section 1.1471-3(a)), but the
payment is not subject to chapter 4
withholding because of the payee's
chapter 4 status. Also, if the withholding
agent applies the 90-day grace period for
a withholdable payment following a
change in circumstances, use exemption
code 15 (payee not subject to chapter 4
withholding).
A withholding agent should use
exemption code 21 (excluded payment on
offshore obligation) for a payment that is
excluded from the definition of a
withholdable payment under Regulations
section 1.1473-1(a)(4)(vi). If another
exemption code applies, it should be used
instead of exemption code 21. The
exemption for these types of payments will
end for payments made after December
31, 2016.
A withholding agent should use
exemption code 22 (excluded payments
on collateral) for a payment made with
respect to a collateral arrangement that is
excluded from the definition of a
withholdable payment under Regulations
section 1.1473-1(a)(4)(vii). If another
exemption code applies, it should be used
instead of exemption code 22. The
exemption for these types of payments will
end for payments made after December
31, 2016.
A withholding agent should use
exemption code 16 (excluded nonfinancial
payment) only if exemption code 16 is the
only exemption code that applies. If
another exemption code applies, it should
be used instead of exemption code 16.
A withholding agent should use
exemption code 17 (foreign entity that
assumes primary withholding
responsibility) only if it makes a payment
to a QI that assumes primary withholding
responsibility, a WP, or a WT.
A withholding agent should use
exemption code 18 (U.S. payees – of
participating FFI or registered
deemed-compliant FFI) only if it makes a
payment to a participating FFI or
registered deemed-compliant FFI and only
to the extent represented on such FFI's
withholding statement associated with its
Form W-8IMY that the payment is
allocable to a chapter 4 withholding rate
pool of U.S. payees and FFI certifies on its
withholding certificate that the FFI meets
the requirements to include the account
Instructions for Form 1042-S (2015)

holder in a withholding rate pool of U.S.
payees.
A withholding agent should use
exemption code 20 (dormant account)
only if it makes a withholdable payment to
a participating FFI or registered
deemed-compliant FFI that represented
on its withholding statement associated
with its Form W-8IMY that the payment is
allocable to a dormant account holder for
which the escrow procedure of
Regulations section 1.1471-4(b)(6)
applies.
If you have failed to provide another
withholding agent with appropriate
information regarding the status of the
person to whom you are making a
payment, the other withholding agent may
be required to withhold on the payment
based on the presumption rules. If the
income is in fact exempt from withholding
or subject to a reduced rate of withholding,
and the account holder requests a
corrected form, you must submit a Form
1042-S providing the correct information.
In this situation, you must:
Indicate the correct rate at which the
income should have been subject to
withholding in boxes 3b or 4b,
Enter the appropriate exemption codes,
if any, in boxes 3a and 4a,
Enter the actual amount of U.S. federal
tax withheld by the other withholding
agent in box 8,
Provide the name and address of the
actual recipient in boxes 13a-g along with
the other required information for the
recipient.
Provide the name and EIN of the other
withholding agent that actually withheld
and deposited the tax (primary withholding
agent) in boxes 14a and b.

!

If you must submit Form 1042-S,
you must also submit Form 1042.

CAUTION

Special instructions for use of Chapter 3 Exemption Codes. If an amount
was withheld under chapter 4, you may
also include a chapter 3 exemption code
and tax rate in boxes 3a and 3b to show
the rate that would otherwise apply if the
payment was exempt from withholding
under chapter 4. This may be done, for
example, to assist the beneficial owner in
pursuing a claim for refund. In such a
case, do not check box 3 (only box 4
should be checked) to show that
withholding was applied under chapter 4.

Boxes 3b and 4b, Tax Rate

Enter the correct rate of withholding that
applies to the income in box 2 (gross
income) or box 6 (net income), as
appropriate. In the case of a payment
subject to chapter 4 withholding, the
correct rate of withholding is “30.00.” For
purposes of chapter 3 withholding, see
Valid Tax Rate Table, later. The correct
-21-

tax rate should be included even if you
withheld at a different rate. For example, if
an NQI that is a participating FFI is
reporting dividends paid to a beneficial
owner who is exempt from withholding
under chapter 4 and a resident of a
country with which the United States does
not have a tax treaty and a U.S.
withholding agent paid the dividend and
incorrectly withheld only 15% under
chapter 3 (rather than the required 30%)
and the NQI withholds an additional 15%
under chapter 3, the NQI should report
“30.00” in box 3b. See Example 2. in
Multiple Withholding Agent Rule, earlier.
The tax rate on dividends paid to a
corporation created or organized in, or
under the law of, the Commonwealth of
Puerto Rico may be 10%, rather than
30%. See Pub. 515 for more information.
In the case of a specified Federal
procurement payment subject to section
5000C, withholding, the correct rate of
withholding is 2% or “02.00.” For Form
1042-S purposes, report tax withheld
under section 5000C in box 3b as if the tax
were a chapter 3 tax.
Enter the tax rate using the following
format: two digits, a decimal, and two
digits (for example,“30.00” for 30%).
However, if the income is exempt from tax
under a U.S. tax treaty or the Code, enter
“00.00.” If the tax rate is less than 10%,
enter a zero before the tax rate (for
example, “04.00” for 4%).
If you withheld at more than one
tax rate for a specific type of
CAUTION
income that you paid to the same
recipient, you must file a separate Form
1042-S, Copy A, for each amount to which
a separate rate was applied.

!

Valid Tax Rate Table
00.00

08.00

20.00

02.00

10.00

25.00

04.00

12.00

27.50

04.90

12.50

28.00

04.95

14.00

30.00

05.00

15.00

35.00

07.00

17.50

39.60

Exception for central withholding
agreements. If you are the designated
withholding agent who has entered into a
central withholding agreement and you
report an amount in box 2 using income
code 43 (earnings as an artist or
athlete-central withholding agreement),
you do not have to enter a tax rate in
box 3b but you must include a chapter 4
exemption code 16 (excluded nonfinancial
payments) in box 4a.

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Box 5, Withholding
Allowance

This box should be completed only if the
income code reported in box 1 is 16
(scholarship or fellowship grants), 17
(compensation for independent personal
services), 18 (compensation for
dependent personal services), 19
(compensation for teaching), 20
(compensation during studying and
training), or 42 (earnings as an artist or
athlete-no central withholding agreement).
See Pub. 515 for more information.

Box 6, Net Income

Complete this box only if you entered an
amount in box 5. Otherwise, leave it blank.

Boxes 7 Through 10,
Federal Tax Withheld
Box 7. Enter the total amount of U.S.
federal tax you actually withheld in box 7
under chapter 3 or 4. If you did not
withhold any tax, enter “-0-.” If you are a
participating FFI or registered
deemed-compliant FFI that, for chapter 4
purposes, applied the escrow procedure
for dormant accounts, if the payment is
also an amount subject to chapter 3
withholding and tax is withheld and
deposited under chapter 3, do not check
the box “Check if tax not deposited with
IRS pursuant to escrow procedure.”
Instead check box 3 and complete box 3b
to report the tax withheld under chapter 3.
A withholding agent that withheld tax
during calendar year 2015 and that was
not required to deposit with the IRS the tax
withheld during calendar year 2015
pursuant to the escrow procedure under
Regulations sections 1.1471-2(a)(5)(ii)
and/or 1.1441-3(d) must check the box
“Check if tax not deposited with IRS
pursuant to escrow procedure.” A
withholding agent reporting payments
pursuant to the escrow procedure must
report such payments on separate Forms
1042-S.

!

CAUTION

Box 7 must be completed in all
cases, even if no tax has been
deposited.

Box 8. If you are a withholding agent filing
a Form 1042-S to report income that has
already been subject to withholding by
another withholding agent, enter the
amount actually withheld by the other
agent(s) in box 8. Further, report in box 8
any credit forward of prior withholding as
determined under Notice 2010-46 with
respect to substitute dividend payments.
Box 9. Enter the total amount of tax paid
by you and not withheld from the payment
to the recipient.
Box 10. Enter in box 10 the total amount
of tax withheld by you (box 7) and any

other withholding agent (box 8), but do not
include the amount reported in box 9.

Box 11, Amount Repaid to
Recipient

This box should be completed only if:
You repaid a recipient under the
reimbursement procedure (see
instructions to Form 1042) an amount of
tax that was overwithheld under chapter 3
or 4; and
You are going to reimburse yourself by
reducing, by the amount of tax actually
repaid to the recipient, the amount of any
deposit made for a payment period in the
calendar year following the calendar year
of withholding that is prior to March 15,
2016.
In most cases, an intermediary or
flow-through entity should not enter an
amount in box 11 unless it is a QI that
represented on its Form W-8IMY that it is
assuming primary withholding
responsibility or is a WP or WT.
In order to claim a credit for amounts
overwithheld, you must timely file a Form
1042 to claim a credit for tax overwithheld
and attach a statement that the filing of the
Form 1042 constitutes a claim for refund.
The adjustment for amounts
overwithheld does not apply to
CAUTION
partnerships or nominees
required to withhold under section 1446.

!

Box 12a, Withholding
Agent's Employer
Identification Number
(EIN)

In most cases, you are required to enter
your EIN. However, if you are filing Form
1042-S as a QI, WP, or WT, enter your
QI-EIN, WP-EIN, or WT-EIN.

If you do not have an EIN, you can
apply for one online at
www.irs.gov/businesses/small or by
telephone at 1-800-829-4933. Also, you
can apply for an EIN by filing Form SS-4,
Application for Employer Identification
Number. File amended Forms 1042-S
when you receive your EIN.
To get a QI-EIN, WP-EIN, or WT-EIN,
submit Form SS-4 with your application for
that status. (See the definitions for
Qualified intermediary (QI), and
Withholding foreign partnership (WP) or
withholding foreign trust (WT) in
Definitions, earlier, for more information.)

Boxes 12b and 12c,
Withholding Agent's
Chapter 3 and Chapter 4
Status Code

Enter the withholding agent status code(s)
from the list of Recipient Codes, earlier. A
-22-

chapter 4 status code is required only if
the income reported in box 2 is a
withholdable payment. A chapter 3 status
code is not required if the income reported
in box 2 is not an amount subject to
chapter 3 withholding.

Boxes 12d-12i,
Withholding Agent's
Name, GIIN, Country Code,
Foreign TIN (if any), and
Address

Enter your name and address in the
appropriate boxes. If your post office does
not deliver mail to the street address and
you have a P.O. box, show the box
number instead of the street address.
If you are a nominee that is the
withholding agent under section 1446,
enter the PTP's name and other
information in boxes 15a through 15i.
Also, enter your chapter 3 and
chapter 4 status codes to the extent
applicable from Exemption Codes and
Recipient Codes, earlier.

Note. On statements furnished to
individual recipients of U.S. source
deposit interest, in addition to your name
and address, you must include the
telephone number of a person to contact.
This number must provide direct access to
an individual who can answer questions
about the statement. The telephone
number is not required on Copy A of paper
forms or on electronically filed forms.
Box 12e, Withholding Agent's GIIN.
The GIIN provided, if any, should be the
GIIN issued to the branch of, or
disregarded entity owned by, the
participating FFI or registered
deemed-compliant FFI that is making the
payment.

Boxes 13a and 13h,
Recipient's U.S. Taxpayer
Identification Number
(TIN) and GIIN

You must obtain and enter a U.S. taxpayer
identification number (TIN) for any of the
following recipients.
Any recipient whose income is
effectively connected with the conduct of a
trade or business in the United States.
Note. For these recipients, enter
exemption code 01 in box 3a or exemption
code 14 in box 4a.
Any foreign person claiming a reduced
rate of, or exemption from, tax under a tax
treaty between a foreign country and the
United States, unless the recipient
provides a foreign TIN (in such case, use
box 13i), or unless the income is an
unexpected payment (as described in
Instructions for Form 1042-S (2015)

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Regulations section 1.1441-6(g)) or
consists of dividends and interest from
stocks and debt obligations that are
actively traded; dividends from any
redeemable security issued by an
investment company registered under the
Investment Company Act of 1940 (mutual
fund); dividends, interest, or royalties from
units of beneficial interest in a unit
investment trust that are (or were, upon
issuance) publicly offered and are
registered with the Securities and
Exchange Commission under the
Securities Act of 1933; and amounts paid
with respect to loans of any of the above
securities. In the latter case, you must use
income code 13, 51, 52, or 53.
Any nonresident alien individual
claiming exemption from tax under section
871(f) for certain annuities received under
qualified plans.
A foreign organization claiming an
exemption from tax solely because of its
status as a tax-exempt organization under
section 501(c) or as a private foundation.
Any QI.
Any WP or WT.
Any nonresident alien individual
claiming exemption from withholding on
compensation for independent personal
services.
Any U.S. branch of an FFI or territory FI
that is treated as a U.S. person.
Any QSL that was paid a substitute
dividend.
In all other cases, if you know the
recipient's TIN or if a foreign person
provides a TIN on Form W-8, but is not
required to do so, you must include the
TIN on Form 1042-S.
You must include a GIIN if you are
required to collect a GIIN for the recipient
under the requirements documenting the
payee under chapter 4. If the recipient
completes Part II of Form W-8BEN-E, then
report the GIIN provided in that section.

Boxes 13b-g, Recipient's
Status Code, Name,
Country Code, and
Address
Boxes 13b and 13c, Recipient Status
Code. Enter the recipient status code
from the list of Recipient Status Codes,
earlier. The following special instructions
apply for chapter 3 status codes.
If applicable, use recipient code 22
(artist or athlete) instead of recipient code
16 (individual), 15 (corporation), or 08
(partnership other than withholding foreign
partnership).
If you are making a payment to an NQI
or flow-through entity, in most cases you
must use the recipient code that applies to
the type of recipient who receives the
income from the NQI or flow-through
entity.
Instructions for Form 1042-S (2015)

Use recipient code 08 (partnership
other than withholding foreign partnership)
only if you are reporting a payment of
income that is effectively connected with
the conduct of a trade or business of a
nonwithholding foreign partnership in the
United States. Otherwise, follow the rules
that apply to payments to flow-through
entities.
Use recipient code 21 (unknown
recipient) only if you have not received a
withholding certificate or other
documentation for a recipient or you
cannot determine how much of a payment
is reliably associated with a specific
recipient. Do not use this code because
you cannot determine the recipient's
status as an individual, corporation, etc.
The regulations under chapter 3 provide
rules on how to determine a recipient's
status when a withholding agent does not
have the necessary information.
Use recipient code 13 (qualified
securities lender – qualified intermediary)
or 14 (qualified securities lender – other) if
you make a payment to a QSL.
Use recipient code 37 (undocumented
preexisting obligation) for an obligation
that a withholding agent has not
documented and the payment being
reported was made before the expiration
of time period allowed for documenting the
obligation and thus the withholding agent
was not required to apply the presumption
rules to determine the payee's chapter 4
status.
Only QIs may use recipient codes 29
(PAI withholding rate pool – general) and
30 (PAI withholding rate pool – exempt
organizations). Only QIs, WPs, and WTs
that made a pooled reporting election for
chapter 3 purposes may use recipient
codes 31 (agency withholding rate pool –
general), 32 (agency withholding rate pool
– exempt organization), 33 (joint account
withholding rate pool), 27 (withholding rate
pool – general), and 28 (withholding rate
pool – exempt organization) for chapter 3
purposes. Recipient code 28 or 30 should
be used only for pooled account holders
that have claimed an exemption based on
their tax-exempt status and not some
other exemption (for example, treaty or
other Code exception). Do not include a
chapter 4 status code for the recipient if
you are using a chapter 3 pooled reporting
code as the recipient’s chapter 3 status
code.
A U.S. withholding agent making a
payment to a QI should use recipient code
12 and recipient code 09 or 11 if it is
making a payment to a WP or WT,
respectively.
A chapter 4 status code is required only
if the payment is a withholdable payment
or when a participating FFI or registered
deemed-compliant FFI provides a
chapter 4 withholding rate pool of U.S.
payees. The chapter 4 status code may be
-23-

determined under the applicable
intergovernmental agreement (IGA) by a
withholding agent that is an FFI subject to
such an agreement. The following special
instructions apply for chapter 4 status
codes.
Only use recipient code 29 (unknown
recipient) if you have received a
withholding certificate or other
documentation with respect to a
withholdable payment from an
intermediary or flow-through entity. Only
use this code if you also used recipient
code 21 (unknown recipient) as the
chapter 3 status code. If you have
received a withholding certificate or other
documentation from an intermediary or
flow-through entity, you must include the
entity’s information in boxes 15a through
15i.
Use recipient code 38 (account holder
of excluded financial account) if you are
reporting amounts paid with respect to an
obligation that is excluded from the
definition of financial account for chapter 4
purposes (see Regulations section
1.1471-5(b)(2)).
Use recipient code 41 if you are
reporting amounts paid to a specific
recipient that is an NFFE that you (or
another withholding agent) withheld upon
under section 1472 (i.e., you are reporting
amounts in boxes 7 through 9) unless the
NFFE is treated as a recalcitrant account
holder under Regulations section
1.1471-5(g), in which case, use code 30
(recalcitrant account holder).
Use recipient code 47 (nonparticipating
FFI pool) if you received a withholding
certificate or other documentation with
respect to a withholdable payment from an
intermediary or flow-through entity that is a
participating FFI or deemed-compliant FFI
(other than a WP, WT, or QI that assumes
primary withholding responsibility) and
cannot reliably associate the payment with
documentation to determine the payee's
chapter 4 status. You must also report the
recipient as “Unknown Recipient” and
include the entity's information in boxes
15a through 15i.
If you are a QI, WP, or WT reporting
direct account holders, do not include a
chapter 3 status code for the recipient if
you are using a chapter 4 reporting pool
code as the recipient’s chapter 4 status
code.
Only use recipient code 15
(nonparticipating FFI) or 30 (recalcitrant
account holder) if you are reporting
directly to the recipient. See Amounts paid
to a nonqualified intermediary or
flow-through entity earlier. If you are
reporting the chapter 4 reporting pools of
recalcitrant account holders of a
participating FFI, registered
deemed-compliant FFI or QI, use codes
42 through 49. Only use chapter 4
reporting pool code 48 (U.S. payees pool)

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if a participating FFI or registered
deemed-compliant FFI has provided a
Form W-8IMY certifying that it meets the
requirements to include the account
holder in a withholding rate pool of U.S.
payees and that is associated with a
withholding statement allocating the
payment or a portion of the payment to a
chapter 4 withholding rate pool of U.S.
payees. Only use chapter 4 reporting pool
code 49 (QI-Recalcitrant Pool-General) if
you are reporting recalcitrant account
holders of a QI.
1. Use code 26 (excepted NFFE –
other) if you are reporting to an NFFE
treated as a U.S. person.
Box 13d, Recipient's Name. Enter the
complete name of the recipient in box 13d.
If you do not know the name of the
recipient, enter “Unknown Recipient.”
If Form 1042-S is being completed by a
QI, WP, or WT for a chapter 3 withholding
rate pool, or chapter 4 withholding pool,
enter “Withholding rate pool” if withholding
under chapter 3 was applied or if
chapter 4 withholding was applied, a
description of the chapter 4 reporting pool
(for example “Nonparticipating FFI Pool ”)
in box 13d.
A withholding agent reporting payments
made to a participating FFI or registered
deemed-compliant FFI with respect to a
chapter 4 reporting pool must include the
name and address of the FFI in boxes 13d
through 13g as well as the FFI's GIIN and
country code. The GIIN reported must be
the GIIN of the branch to whom the
withholding agent is making the payment.
A QI reporting payments made to a PAI
on a withholding rate pool basis must
include the name and address of the PAI
in boxes 13d through 13g.
Box 13e, Recipient's Country Code.
You must enter the code (from Country
Codes, later) for the country of which the
recipient claims residency under that
country's tax laws. Enter “OC” (other
country) only when the country of
residence does not appear on the list or
the payment is made to an international
organization (for example, the United
Nations). Enter “UC” (unknown country)
only if the payment is to an unknown
recipient. If you are making a payment to a
QI, QSL, WP, or WT, or if you are a QI,
QSL, WP, or WT and are making a
payment to a QI, WP, or WT withholding
rate pool, enter the country code of the QI,
WP, or WT. Also, if you are making a
payment to a participating FFI or
registered deemed-compliant FFI's
chapter 4 reporting pool, enter the country
code of the participating FFI or registered
deemed-compliant FFI or branch of or
disregarded entity owned by such FFI
receiving the withholdable payment and
that was listed on Part II of either the Form
W-8BEN-E or W-8IMY.

If exemption code 04 (exempt
under tax treaty) appears in
CAUTION
box 3a or if a reduced rate of
withholding based on a tax treaty is
entered in box 3b, the country code
entered in box 13e must be a country with
which the United States has entered into
an income tax treaty.

!

Boxes 13f and 13g, address. In most
cases, you must enter a foreign address in
boxes 13f and 13g. However, there are
limited exceptions. For example, you may
enter a U.S. address when reporting
payments of scholarship or fellowship
grants (income code 16).
For addresses outside the United
States or its commonwealths and
possessions, follow the foreign country's
practice for entering the postal code.
For addresses within the United States,
use the U.S. Postal Service 2-letter
abbreviation for the state name. Do not
enter “United States” or “U.S.”
If you want to enter the recipient's
account number, use box 16.

Box 13i, Recipient's
Foreign Tax Identifying
Number

You must obtain and enter a foreign
taxpayer identifying number for any of the
following recipients:
Any foreign person claiming a reduced
rate of, or exemption from, tax under a tax
treaty between a foreign country and the
United States if such person did not
provide a U.S. TIN and the income is not
the type for which an exemption from the
TIN requirement applies (as described
earlier).
Any recipient of a payment made with
respect to an obligation maintained at a
U.S. office or branch of the withholding
agent if withholding agent is a financial
institution and the foreign taxpayer
identifying number is available in the
withholding agent's electronically
searchable information or is required to be
collected by the withholding agent on
Form W-8.
Use box 13i to enter the recipient's
identifying number used in the recipient's
country of residence for tax purposes. Box
13i is optional except as described above.
Note. Starting in calendar year 2017, with
respect to an obligation that a withholding
agent that is a financial institution
maintains at its U.S. office or branch, a
withholding agent will be required to report
either the recipient's foreign tax
identification number or the recipient's
date of birth. The recipient's foreign tax
identification number will be required in
box 13i if the recipient is resident in a
country identified in the instructions for
-24-

“Requester of Forms W-8BEN, W-8ECI,
W-8EXP, and W-8IMY” as required to
provide a foreign taxpayer identification
number. In all other cases, the recipient's
date of birth will be required in box 17.

Boxes 14a and 14b,
Primary Withholding
Agent's Name and EIN

If you reported amounts withheld by
another withholding agent (the primary
withholding agent), you must provide the
name and EIN of the withholding agent
that withheld the tax reported in box 8. If
multiple withholding agents withheld
amounts reported on the same Form
1042-S, report the name of any one of the
withholding agents that withheld amounts.

Boxes 15a Through 15i,
Intermediary/
Flow-Through Entity's
Name, Status Code,
Country Code, Address,
EIN, GIIN, and Foreign
Taxpayer Identification
Number

If you are reporting amounts paid to a
recipient whose withholding certificates or
other documentation has been submitted
to you with a Form W-8IMY provided by an
intermediary or flow-through entity, you
must include the name and address of the
intermediary or flow-through entity with
whose Form W-8IMY the recipient's Form
W-8 or other documentation is associated.
You must also include the intermediary
or flow-through entity's chapter 3 and
chapter 4 status codes and, if any, the TIN
and GIIN of the intermediary or
flow-through entity when provided or
required to be collected by the withholding
agent. If the intermediary or flow-through
completed Part II of Form W-8IMY, the
report the GIIN provided in that section.
Note. An intermediary or flow-through
entity will leave these boxes blank unless
it is making the payment to an
intermediary or flow-through entity.

Box 15f, Country Code. You must enter
the country code from Country Codes,
later, for the country where the
intermediary or flow-through entity is
located.
Box 15g, Intermediary or
Flow-Through Entity's Foreign Taxpayer Identification Number. Use box 15g
to enter the intermediary or flow-through
entity's identifying number used in the
country of residence for tax purposes. Box
15g is optional.
If you are a nominee that is the
withholding agent under section 1446,
Instructions for Form 1042-S (2015)

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enter the PTP's name and other
information in these boxes.

Box 16, Recipient’s
Account Number

If you are a financial institution reporting
amounts paid to your direct account
holder with respect to an account
maintained by you at your U.S. office or
branch, you must report the recipient’s
account number in box 16. If the amount is
paid through a nonqualified intermediary
or flow-through entity, you are not required
to use this box.

Box 17, Recipient’s Date of
Birth
Use box 17 to enter the recipient’s date of
birth if it is available in the withholding
agent's electronically searchable
information. Box 17 is optional.

Note. Starting in calendar year 2017, the
withholding agent will be required to report
either the recipient's foreign tax
identification number or the recipient's
date of birth.

Boxes 18 Through 20,
Payer's Name, Payer's TIN,
and Payer's GIIN
See the definition of Payer in Definitions,
earlier. Include the payer's name, TIN, and
GIIN if different from the withholding agent
shown in boxes 12a, d, and e.

Boxes 21 Through 23,
State Income Tax Withheld
and Related Information
Include in these boxes information relating
to any state income tax withheld.

Amended Returns

If you filed a Form 1042-S with the IRS
and later discover you made an error on it,
you must correct it as soon as possible.
To correct a previously filed Form 1042-S,
you will need to file an amended Form
1042-S.

Instructions for Form 1042-S (2015)

You may be required to submit
amended Forms 1042-S
CAUTION
electronically. See Electronic
Reporting, earlier, and Pub. 1187.

!

If any information you correct on
Form(s) 1042-S changes the information
you previously reported on Form 1042,
you also must correct the Form 1042 by
filing an amended return. To do this, see
the Form 1042 instructions.
If you are filing electronically, see
Amended Returns in Pub. 1187.
If you are not filing electronically, follow
these steps to amend a previously filed
Form 1042-S.
Step 1. Prepare a paper Form 1042-S.
Enter all the correct information on the
form, including the recipient name and
address, money amounts, and codes.
Enter an “X” in the amended box at the
top of the form.
Amended checkbox. Enter an “X” in the
amended checkbox of Copy A only if you
are amending a Form 1042-S you
previously filed with the IRS. Enter an “X”
in the amended checkbox on the copy you
give to the recipient only if you are
correcting a Form 1042-S previously
furnished to the recipient. You must
provide statements to recipients showing
the corrections as soon as possible.
Step 2. File the amended paper Form
1042-S with a Form 1042-T. See the Form
1042-T instructions for information on
filing these forms.

!

CAUTION

If you fail to correct Form(s)
1042-S, you may be subject to a
penalty. See Penalties, earlier.

Privacy Act and Paperwork Reduction
Act Notice. We ask for the information on
this form to carry out the Internal Revenue
laws of the United States. Sections 1441,
1442,1446 (for PTPs), 1471, and 1472
require withholding agents to report and
pay over to the IRS taxes withheld from
certain U.S. source income. Form 1042-S
is used to report the amount of income

-25-

and withholding to the payee. Form 1042
is used to report the amount of withholding
that must be paid over to the IRS. Section
6109 requires you to provide your
identification number. Routine uses of this
information include giving it to the
Department of Justice for civil and criminal
litigation, and cities, states, the District of
Columbia, and U.S. Commonwealths and
possessions for use in administering their
tax laws. We may also disclose this
information to other countries under a tax
treaty, to federal and state agencies to
enforce federal nontax criminal laws, or to
federal law enforcement and intelligence
agencies to combat terrorism. If you fail to
provide this information in a timely
manner, you may be liable for penalties
and interest.
You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB
control number. Books or records relating
to a form or its instructions must be
retained as long as their contents may
become material in the administration of
any Internal Revenue law. Generally, tax
returns and return information are
confidential, as required by section 6103.
The time needed to complete and file
this form will vary depending on individual
circumstances. The estimated average
time is 34 minutes.
If you have comments concerning the
accuracy of these time estimates or
suggestions for making this form simpler,
we would be happy to hear from you. You
can send us comments from www.irs.gov/
formspubs. Click on “More Information”
and then on “Give us feedback.” Or you
can write to Internal Revenue Service, Tax
Forms and Publications, 1111 Constitution
Ave. NW, IR-6526, Washington, DC
20224. Do not send the form to this
address. Instead, see Where, When, and
How To File, earlier.

Page 26 of 27

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The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Country Codes
Select the appropriate code from the
following list and enter it in box 16 (country
code of recipient). Also use the following
codes to complete box 18 (country code of
NQI), if applicable. See the instructions for
box 16 (and box 18 if applicable), earlier,
before selecting a country code. Note.
Countries bolded and italicized are those
with which the United States had entered
into an income tax treaty at the time these
instructions were printed.

Country
Afghanistan . . . . . . . . . . . . . .
Akrotiri . . . . . . . . . . . . . . . . . .
Albania . . . . . . . . . . . . . . . . .
Algeria . . . . . . . . . . . . . . . . . .
American Samoa . . . . . . . . . .
Andorra . . . . . . . . . . . . . . . . .
Angola . . . . . . . . . . . . . . . . . .
Anguilla . . . . . . . . . . . . . . . . .
Antarctica . . . . . . . . . . . . . . . .
Antigua and Barbuda . . . . . . . .
Argentina . . . . . . . . . . . . . . . .
Armenia1 . . . . . . . . . . . . . . . .
Aruba . . . . . . . . . . . . . . . . . .
Ashmore and Cartier Islands2
Australia . . . . . . . . . . . . . . . .
Austria . . . . . . . . . . . . . . . . . .
Azerbaijan1. . . . . . . . . . . . . . .
Bahamas, The . . . . . . . . . . . .
Bahrain . . . . . . . . . . . . . . . . .
Baker Island . . . . . . . . . . . . . .
Bangladesh . . . . . . . . . . . . . .
Barbados . . . . . . . . . . . . . . . .
Belarus1 . . . . . . . . . . . . . . . . .
Belgium . . . . . . . . . . . . . . . . .
Belize . . . . . . . . . . . . . . . . . .
Benin . . . . . . . . . . . . . . . . . .
Bermuda . . . . . . . . . . . . . . . .
Bhutan . . . . . . . . . . . . . . . . . .
Bolivia . . . . . . . . . . . . . . . . . .
Bosnia-Herzegovina . . . . . . . .
Botswana . . . . . . . . . . . . . . . .
Bouvet Island . . . . . . . . . . . . .
Brazil . . . . . . . . . . . . . . . . . . .
British Indian Ocean
Territory . . . . . . . . . . . . . . .
Brunei . . . . . . . . . . . . . . . . . .
Bulgaria . . . . . . . . . . . . . . . . .
Burkina Faso . . . . . . . . . . . . .
Burma . . . . . . . . . . . . . . . . . .
Burundi . . . . . . . . . . . . . . . . .
Cambodia . . . . . . . . . . . . . . .
Cameroon . . . . . . . . . . . . . . .
Canada . . . . . . . . . . . . . . . . .
Cape Verde . . . . . . . . . . . . . .
Cayman Islands . . . . . . . . . . .
Central African Republic . . . . .
Chad . . . . . . . . . . . . . . . . . . .
Chile . . . . . . . . . . . . . . . . . . .
China . . . . . . . . . . . . . . . . . . .
Christmas Island2 . . . . . . . . . .
Clipperton Island . . . . . . . . . . .
Cocos (Keeling) Islands2 . . . .
Colombia . . . . . . . . . . . . . . . .
Comoros . . . . . . . . . . . . . . . .
Congo (Brazzaville) . . . . . . . . .
Congo, Democratic Republic of
(Kinshasa) . . . . . . . . . . . . .
Cook Islands . . . . . . . . . . . . .
Coral Sea Islands Territory2 . .

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Code
AF
AX
AL
AG
AQ
AN
AO
AV
AY
AC
AR
AM
AA
AT
AS
AU
AJ
BF
BA
FQ
BG
BB
BO
BE
BH
BN
BD
BT
BL
BK
BC
BV
BR
IO
BX
BU
UV
BM
BY
CB
CM
CA
CV
CJ
CT
CD
CI
CH
KT
IP
CK
CO
CN
CF
CG
CW
CR

Costa Rica . . . . . . . . . . . . . .
Cote D'Ivoire (Ivory Coast) . . .
Croatia . . . . . . . . . . . . . . . . .
Cuba . . . . . . . . . . . . . . . . . .
Cyprus . . . . . . . . . . . . . . . . .
Czech Republic . . . . . . . . . .
Denmark . . . . . . . . . . . . . . .
Dhekelia . . . . . . . . . . . . . . .
Djibouti . . . . . . . . . . . . . . . .
Dominica . . . . . . . . . . . . . . .
Dominican Republic . . . . . . .
Ecuador . . . . . . . . . . . . . . . .
Egypt . . . . . . . . . . . . . . . . . .
El Salvador . . . . . . . . . . . . . .
Equatorial Guinea . . . . . . . . .
Eritrea . . . . . . . . . . . . . . . . .
Estonia . . . . . . . . . . . . . . . . .
Ethiopia . . . . . . . . . . . . . . . .
Falkland Islands (Islas
Malvinas) . . . . . . . . . . . . .
Faroe Islands . . . . . . . . . . . .
Fiji . . . . . . . . . . . . . . . . . . . .
Finland . . . . . . . . . . . . . . . . .
France . . . . . . . . . . . . . . . . .
French Guiana3 . . . . . . . . . .
French Polynesia . . . . . . . . .
French Southern and Antarctic
Lands . . . . . . . . . . . . . . . .
Gabon . . . . . . . . . . . . . . . . .
Gambia, The . . . . . . . . . . . .
Georgia1 . . . . . . . . . . . . . . . .
Germany . . . . . . . . . . . . . . .
Ghana . . . . . . . . . . . . . . . . .
Gibraltar . . . . . . . . . . . . . . . .
Great Britain (United
Kingdom) . . . . . . . . . . . . .
Greece . . . . . . . . . . . . . . . . .
Greenland . . . . . . . . . . . . . .
Grenada . . . . . . . . . . . . . . .
Guadeloupe3 . . . . . . . . . . . .
Guam . . . . . . . . . . . . . . . . .
Guatemala . . . . . . . . . . . . . .
Guernsey . . . . . . . . . . . . . . .
Guinea . . . . . . . . . . . . . . . . .
Guinea-Bissau . . . . . . . . . . .
Guyana . . . . . . . . . . . . . . . .
Haiti . . . . . . . . . . . . . . . . . . .
Heard Island and McDonald
Islands . . . . . . . . . . . . . . .
Holy See . . . . . . . . . . . . . . .
Honduras . . . . . . . . . . . . . . .
Hong Kong5 . . . . . . . . . . . . .
Howland Island . . . . . . . . . . .
Hungary . . . . . . . . . . . . . . . .
Iceland . . . . . . . . . . . . . . . . .
India . . . . . . . . . . . . . . . . . . .
Indonesia . . . . . . . . . . . . . . .
Iran . . . . . . . . . . . . . . . . . . .
Iraq . . . . . . . . . . . . . . . . . . .
Ireland . . . . . . . . . . . . . . . . .
Isle of Man . . . . . . . . . . . . . .
Israel . . . . . . . . . . . . . . . . . .
Italy . . . . . . . . . . . . . . . . . . .
Jamaica . . . . . . . . . . . . . . . .
Jan Mayen . . . . . . . . . . . . . .
Japan . . . . . . . . . . . . . . . . . .
Jarvis Island . . . . . . . . . . . . .
Jersey . . . . . . . . . . . . . . . . .
Johnston Atoll . . . . . . . . . . . .
Jordan . . . . . . . . . . . . . . . . .
Kazakhstan . . . . . . . . . . . . .
Kenya . . . . . . . . . . . . . . . . .
Kingman Reef . . . . . . . . . . . .
Kiribati . . . . . . . . . . . . . . . .
Korea, North . . . . . . . . . . . . .

-26-

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CS
IV
HR
CU
CY
EZ
DA
DX
DJ
DO
DR
EC
EG
ES
EK
ER
EN
ET

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FK
FO
FJ
FI
FR
FG
FP

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FS
GB
GA
GG
GM
GH
GI

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UK
GR
GL
GJ
GP
GQ
GT
GK
GV
PU
GY
HA

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HM
VT
HO
HK
HQ
HU
IC
IN
ID
IR
IZ
EI
IM
IS
IT
JM
JN
JA
DQ
JE
JQ
JO
KZ
KE
KQ
KR
KN

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Korea, South . . . . . . . . . . .
Kosovo . . . . . . . . . . . . . . .
Kuwait . . . . . . . . . . . . . . . .
Kyrgyzstan1 . . . . . . . . . . . .
Laos . . . . . . . . . . . . . . . . .
Latvia . . . . . . . . . . . . . . . . .
Lebanon . . . . . . . . . . . . . .
Lesotho . . . . . . . . . . . . . . .
Liberia . . . . . . . . . . . . . . . .
Libya . . . . . . . . . . . . . . . . .
Liechtenstein . . . . . . . . . . .
Lithuania . . . . . . . . . . . . . .
Luxembourg. . . . . . . . . . . .
Macau . . . . . . . . . . . . . . . .
Macedonia . . . . . . . . . . . .
Madagascar (Malagasy
Republic) . . . . . . . . . . . .
Malawi . . . . . . . . . . . . . . . .
Malaysia . . . . . . . . . . . . . .
Maldives . . . . . . . . . . . . . .
Mali . . . . . . . . . . . . . . . . . .
Malta . . . . . . . . . . . . . . . . .
Marshall Islands . . . . . . . . .
Martinique3. . . . . . . . . . . . .
Mauritania . . . . . . . . . . . . .
Mauritius . . . . . . . . . . . . . .
Mayotte . . . . . . . . . . . . . . .
Mexico . . . . . . . . . . . . . . . .
Micronesia, Federated States
of . . . . . . . . . . . . . . . . . .
Midway Islands . . . . . . . . . .
Moldova1 . . . . . . . . . . . . . .
Monaco . . . . . . . . . . . . . . .
Mongolia . . . . . . . . . . . . . .
Montenegro . . . . . . . . . . . .
Montserrat . . . . . . . . . . . . .
Morocco . . . . . . . . . . . . . . .
Mozambique . . . . . . . . . . .
Namibia . . . . . . . . . . . . . . .
Nauru . . . . . . . . . . . . . . . .
Navassa Island . . . . . . . . . .
Nepal . . . . . . . . . . . . . . . .
Netherlands . . . . . . . . . . . .
Netherlands Antilles . . . . . .
New Caledonia . . . . . . . . . .
New Zealand . . . . . . . . . . .
Nicaragua . . . . . . . . . . . . .
Niger . . . . . . . . . . . . . . . . .
Nigeria . . . . . . . . . . . . . . . .
Niue . . . . . . . . . . . . . . . . .
Norfolk Island2 . . . . . . . . . .
Northern Ireland4 . . . . . . . .
Northern Mariana Islands . . .
Norway. . . . . . . . . . . . . . . .
Oman . . . . . . . . . . . . . . . .
Pakistan . . . . . . . . . . . . . . .
Palau . . . . . . . . . . . . . . . . .
Palmyra Atoll . . . . . . . . . . .
Panama . . . . . . . . . . . . . . .
Papua New Guinea . . . . . . .
Paracel Islands . . . . . . . . . .
Paraguay . . . . . . . . . . . . . .
Peru . . . . . . . . . . . . . . . . .
Philippines . . . . . . . . . . . . .
Pitcairn Island . . . . . . . . . . .
Poland . . . . . . . . . . . . . . . .
Portugal . . . . . . . . . . . . . . .
Puerto Rico . . . . . . . . . . . .
Qatar . . . . . . . . . . . . . . . .
Reunion3 . . . . . . . . . . . . . .
Romania . . . . . . . . . . . . . . .

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KS
KV
KU
KG
LA
LG
LE
LT
LI
LY
LS
LH
LU
MC
MK

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MA
MI
MY
MV
ML
MT
RM
MB
MR
MP
MF
MX

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FM
MQ
MD
MN
MG
MJ
MH
MO
MZ
WA
NR
BQ
NP
NL
NT
NC
NZ
NU
NG
NI
NE
NF
UK
CQ
NO
MU
PK
PS
LQ
PM
PP
PF
PA
PE
RP
PC
PL
PO
RQ
QA
RE
RO

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Instructions for Form 1042-S (2015)

Page 27 of 27

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Fileid: … ons/I1042S/2015/A/XML/Cycle02/source

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Russia . . . . . . . . . . . . . . . .
Rwanda . . . . . . . . . . . . . . .
St. Barthelemy . . . . . . . . . .
St. Helena . . . . . . . . . . . . .
St. Kitts (St. Christopher
and Nevis) . . . . . . . . . . .
St. Lucia . . . . . . . . . . . . . .
St. Martin . . . . . . . . . . . . . .
St. Pierre and Miquelon . . . .
St. Vincent and the
Grenadines . . . . . . . . . .
Samoa . . . . . . . . . . . . . . . .
San Marino . . . . . . . . . . . .
Sao Tome and Principe . . . .
Saudi Arabia . . . . . . . . . . .
Senegal . . . . . . . . . . . . . . .
Serbia . . . . . . . . . . . . . . . .
Seychelles . . . . . . . . . . . . .
Sierra Leone . . . . . . . . . . . .
Singapore . . . . . . . . . . . . .
Slovak Republic (Slovakia)
Slovenia . . . . . . . . . . . . . . .
Solomon Islands . . . . . . . . .
Somalia . . . . . . . . . . . . . . .
South Africa . . . . . . . . . . . .
South Georgia and the South
Sandwich Islands . . . . . .
Spain . . . . . . . . . . . . . . . . .
Spratly Islands . . . . . . . . . .
Sri Lanka . . . . . . . . . . . . . .
Sudan . . . . . . . . . . . . . . . .
Suriname . . . . . . . . . . . . . .
Svalbard . . . . . . . . . . . . . .
Swaziland . . . . . . . . . . . . .
Sweden . . . . . . . . . . . . . . .
Switzerland . . . . . . . . . . . .
Syria . . . . . . . . . . . . . . . . .
Taiwan . . . . . . . . . . . . . . . .
Tajikistan1 . . . . . . . . . . . . .
Tanzania . . . . . . . . . . . . . .
Thailand . . . . . . . . . . . . . . .
Timor-Leste . . . . . . . . . . . .
Togo . . . . . . . . . . . . . . . . .
Tokelau . . . . . . . . . . . . . . .
Tonga . . . . . . . . . . . . . . . .
Trinidad and Tobago . . . . .
Tunisia . . . . . . . . . . . . . . . .

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RS
RW
TB
SH

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SC
ST
RN
SB

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VC
WS
SM
TP
SA
SG
RB
SE
SL
SN
LO
SI
BP
SO
SF

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SX
SP
PG
CE
SU
NS
SV
WZ
SW
SZ
SY
TW
TI
TZ
TH
TT
TO
TL
TN
TD
TS

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Instructions for Form 1042-S (2015)

Turkey . . . . . . . . . . . . . . . .
Turkmenistan1 . . . . . . . . . .
Turks and Caicos Islands . . .
Tuvalu . . . . . . . . . . . . . . . .
Uganda . . . . . . . . . . . . . . .
Ukraine . . . . . . . . . . . . . . .
United Arab Emirates . . . . .
United Kingdom (England,
Wales, Scotland, No.
Ireland) . . . . . . . . . . . . . .
Uruguay . . . . . . . . . . . . . . .
Uzbekistan1 . . . . . . . . . . . .
Vanuatu . . . . . . . . . . . . . . .
Venezuela . . . . . . . . . . . . .
Vietnam . . . . . . . . . . . . . . .
Virgin Islands (British) . . . . .
Virgin Islands (U.S.) . . . . . .
Wake Island . . . . . . . . . . . .
Wallis and Futuna . . . . . . . .
Western Sahara . . . . . . . . .
Yemen . . . . . . . . . . . . . . .
Zambia . . . . . . . . . . . . . . .
Zimbabwe . . . . . . . . . . . . .
Other Country . . . . . . . . . . .
Unknown Country . . . . . . . .

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TU
TX
TK
TV
UG
UP
AE

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UK
UY
UZ
NH
VE
VM
VI
VQ
WQ
WF
WI
YM
ZA
ZI
OC
UC

1
These countries are former Soviet
republics that are now covered by the
United States treaty with the
Commonwealth of Independent States,
formerly known as the Union of Soviet
Socialist Republics.
2
These countries are covered under the
United States treaty with Australia.

These countries are covered under the
United States treaty with France.
3

4
Northern Ireland is covered under the
United States treaty with the United
Kingdom.

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5
Hong Kong is not covered under the
United States treaty with China.