Home > Basics > What is Form 1042-S and Who Needs to Submit One?

What is Form 1042-S and Who Needs to Submit One?

Foreign workers and students who are considered non-resident aliens and are working in the United States are subject to tax withholding. IRS Form 1042-S is an annual information return for any monetary amounts given to a non-resident alien by a United States based institution or business.

The IRS says that any withholding agent (such as an employer, business, or university) that paid any amount subject to withholding (as described on Form 1042-S on page 4) to a non-resident alien would need to submit a 1042-S information return for every payment recipient.

Some of the payments which are required to be reported on Form 1042-S include but are not limited to: corporate distributions, interest, rents, royalties, compensation for dependent and independent services, pensions and other deferred income, and most gambling winnings.

Some payments are not subject to withholding such as scholarships used for tuition, expense, books, and fees for universities. Also, any service payment that was performed in the person’s country of origin is not subject to withholding. However, these payments are still required to be reported on a 1042-S form. There are more circumstances that are detailed on page 4 of Form 1042-S.

For non-resident alien employees, the form’s purpose is somewhat similar to the W-2 form that employees who are American citizens receive from their employers. The withholding agent files the 1042-S form with the IRS and sends a copy to the payee for information purposes. However, employment earnings are not the only transaction that the form covers.

Non-resident aliens have different laws that regulate tax withholdings than resident aliens. It is important that employers, businesses, universities, and anyone who pays foreign nationals any type of payment to know the resident status of their payees. For tax purposes, resident aliens are treated the same as U.S. citizens.

A non-resident alien can briefly be described as any person who is not a citizen or resident of the United States. If an alien meets the “green card test” or the “substantial presence test” for the calendar year, they are considered a resident alien. If any alien does not meet either one of those tests, they are considered an alien.

It should be noted that any amounts paid to residents of a U.S. possession or territory are not required to be reported on Form 1042-S as long as the payee is a U.S. citizen, resident alien, or U.S. national.

Some of people who would receive a 1042-S form from a withholding agent include students and postdoctoral fellows at American universities who are considered non-resident aliens, and employees at any business who are non-resident aliens under a tax treaty.

A tax treaty between the United States and the foreign national working in the United States may override U.S. income tax laws. Since each scenario is different due to tax treaties, a foreign national should consult an accountant or their employer on whether or not taxes should be withheld from the transaction amount.

Regardless of whether or not taxes are withheld from the transaction amount, any withholding agent that pays an amount of money to a non-resident alien in the U.S. is still required to file a 1042-S form.

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What is Form 1042-S and Who Needs to Submit One?, 4.7 out of 5 based on 12 ratings
  1. February 16th, 2014 at 11:21 | #1

    > Will i file two separate state taxes?

    I dont know.

    > Will i need a W2 from the University? They sent me a 1042S.

    It depends on what the University is reporting. Are they reporting wages; if so, then you need a W-2. Check out
    this article

    http://www.1099fire.com/blog/irs-forms-w-2-and-1042-s-and-international-students/

    It explains the difference between the W-2 and 1042-S for international students. Email if you still
    have questions.

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  2. ME
    February 16th, 2014 at 21:52 | #2

    @Erich J. Ruth

    Thank you for your response. My questions were on behalf of the withholding agent, not the recipient.

    A foreign person was paid and my client did not withhold the proper taxes required. I’m am trying to determine how that client goes about paying those taxes.

    I would appreciate your insight on this as well, but I also plan to contact the IRS at the number you provided.

    Thank you again for your help.

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  3. February 16th, 2014 at 22:33 | #3

    The key is contacting the IRS. Did you take place in tax year 2013? If so, you still have time. The due date for Form 1042-S is March 15. You have to print and mail and efile by March 15 (as opposed to January 31 for the 1099 forms).

    If its a prior year, then you need to submit a correction. I dont know how (or if) you would withhold for a prior year transaction in which the money has already been sent to the foreign person. Its something to ask the IRS.

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  4. ME
    February 17th, 2014 at 19:41 | #4

    Thanks for your reply.

    I was asking on behalf of the withholding agent that should have withheld taxes. If they were not withheld and they want to send in the amount that should have been withheld how do they go about doing that? Is there a form that you send the payment with?

    I’ll give the phone number you provided a try, but I would also like to hear your thoughts.

    Thanks again for your help.

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  5. Esra Kurum
    March 3rd, 2014 at 15:39 | #5

    I did some consulting job for a university last year in US, and I am living in Turkey. I received a 1042S, and that is the only tax document I received. Do I need to file a tax return, or this is just to inform me that the university filed a 1042S form? If I do need to file a tax return, how do I do that? Thank you for your help!

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  6. Apimpnamedslickback
    March 3rd, 2014 at 16:28 | #6

    I did not receive a W2 this year but instead got a 1042S. I have scholarships offered for 2013-2014 academic year how would that affect my returns?

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  7. March 3rd, 2014 at 21:40 | #7

    Im not sure how it affects your tax returns. The 1042-S means that you received income and its possible the university withheld money and sent that withheld money to the IRS. You may be eligible to receive that money. Look at the 1042-S form and see how much, if any, money was withheld.

    If the university would have sent you a W-2 form, then that is telling you the university views you as an employee. No W-2 means your not an employee (in the eyes of University).

    I hope this helps.

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  8. March 3rd, 2014 at 21:43 | #8

    > Do I need to file a tax return, or this is just to inform me that the university filed a 1042S form?

    This is just a form that is telling you the University may have withheld money from your payments. Check the form and see if any money was withheld. If money was withheld, you may be eligible to receive that money.

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  9. Esra Kurum
    March 4th, 2014 at 05:42 | #9

    Thanks Erich!
    You have been very helpful!

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  10. Susan
    March 4th, 2014 at 15:35 | #10

    I live in Mexico, am a US citizen. I received a retirement disbursement. The company claims that since I live in Mexico, they have to send me a 1042S instead of 1099R. I am not an “alien”. Is this accurate, or do I file as a 1099? Thanks

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  11. Susan
    March 4th, 2014 at 15:37 | #11

    I live in Mexico, am a US citizen. I received a retirement disbursement. The company claims that since I live in Mexico, they have to send me a 1042S instead of 1099R. I am not an “alien”. Is this accurate, or do I file as a 1099? Thanks! Also, the money was sent to a US account.

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  12. March 4th, 2014 at 16:20 | #12

    > Is this accurate

    No. The 1042-S is for non-US residents. The 1099-R’s are for US residents.

    I travel sometimes as well. And I would love to live abroad for a summer or even longer. I’m still a US resident. I can do business with US companies (via the internet), get paid by US companies and should receive a 1099 (not a 1042-S).

    A 1042-S means they may be withholding money. The US govt wants US companies to withhold money that is to be paid to non-US residents. Those non-US residents then either:

    1) give up and dont pursue the withheld money (so the IRS wins);

    2) fill out forms to receive that credit depending on which country they are from and whether the US has a tax treaty with that country. This option involves work.

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  13. Susan
    March 6th, 2014 at 22:08 | #13

    So I am a US resident even though I live all of the year in Mexico?@Erich J. Ruth

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  14. Susan
    March 6th, 2014 at 22:45 | #14

    Hi Erich, thanks for your response. I found the suggestion to call the company and tell them they are NOT supposed to send a 1042S to a person with a SSN helpful. It was in a response to someone else. Just to be clear, I am a US citizen and have lived in Mexico for 2 years. The pension disbursement was deposited into one of my US accounts. So should I be getting a 1099R or the dreaded 1042S? If the company insists I should be getting a 1042S, what can/should I do? Besides pull my hair out.
    Thank you!

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  15. March 6th, 2014 at 23:23 | #15

    You tell me. Are you a US resident?

    I was born and raised in Wisconsin. I am a US resident. If I live abroad for a year, it doesn’t mean I lose my citizenship. It also doesn’t mean I don’t have to pay taxes.

    Your first comment stated “I live in Mexico, am a US citizen”. The 1042-S doesn’t apply to you because you are a US citizen. The 1042-S is for non-US residents who receive money from a US business. The US business has to withhold 30% and send that money to the IRS. The non-US resident who gets the 1042-S in the mail may be eligible for that withheld money.

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  16. March 6th, 2014 at 23:27 | #16

    > So should I be getting a 1099R or the dreaded 1042S?

    1099-R.

    > If the company insists I should be getting a 1042S, what
    > can/should I do?

    Call the withholding agent or payer and let them know you have a US SSN and are a US citizen. The 1042-S does not apply to US residents. The 1099 forms do apply to US residents.

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  17. Susan
    March 9th, 2014 at 18:49 | #17

    @Erich J. Ruth
    thank you very much. I am going to apply your advice and call the company in the morning.
    Susan

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  18. Susan
    March 11th, 2014 at 12:28 | #18

    Hi there,
    They said that because I have a Mexico address, the 1042 does apply to me. They did withhold 30% from the disbursement. So now I suppose that means I have to file a 1040NR.
    I may call one more time and see what the next person says! At any rate, I have learned a valuable lesson…always give a US address, even if you are not there at that particular time.
    Susan

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  19. March 11th, 2014 at 12:42 | #19

    The address doesnt matter. What matters is the citizenship.

    We works with many companies where the 1042-S recipient lives in the US. But they are not US residents. They still receive a 1042-S if they are non-US residents. The form title is

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

    Form 1042-S is for non-US residents.

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  20. Arnhild Hagen
    March 13th, 2014 at 07:30 | #20

    I’m from Norway and has inherited microscopic mineral rights (oil and gas) in ND. I receive microscopic royalty from an oil Company, who lease this rights from me and many, many others. I have received a completed form 1042-s. If I am correct, I do not need to fill out a tax return. Is it possible to fill in a form to the IRS to avoid paying 30% tax?

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  21. March 13th, 2014 at 10:34 | #21

    > microscopic mineral rights (oil and gas) in ND

    Congratulations! North Dakota has been booming from oil development.

    > I have received a completed form 1042-s. If I am correct, I do not need to fill out a tax return. Is it possible to fill
    > in a form to the IRS to avoid paying 30% tax?

    You would want to call the IRS and ask. The recipient may be eligible for the 30% that was withheld. It depends on the country
    in which the recipient lives and whether the US has a tax treaty with that company.

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  22. laurie
    March 13th, 2014 at 11:51 | #22

    What forms are due march 15, 2014; the 2013 or the 2014 forms 1042s,1042 and 1042T?

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  23. March 13th, 2014 at 12:14 | #23

    1042-S and 1042-T (which is just the totals) is due Monday March 17. The 1099 forms are due at the end of the month.
    You can easily file for an automatic one month extension.

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  24. David
    March 16th, 2014 at 11:41 | #24

    Hi, I am a retired Canadian and I received pension from a U.S. firm, which they withheld 15% of it. I just received a 1042-S. My question is what do I need to do in order to claim back the 15% that they withheld. What form / document should I use? Thanks for your help.

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  25. nat
    March 18th, 2014 at 15:02 | #25

    Hi,

    I’m a resident alien and I received a copy of the 1042-s as I rented my apartment via airbnb (the withholding agent) for one week. What do I do with this form? Is it kept as just a copy for my personal records as I am not the withholding agent, but the recipient? Do I need to add this to my tax return somehow?

    Any info would be much appreciated!

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  26. March 19th, 2014 at 12:48 | #26

    > What do I do with this form?

    Look at the form. Is there any amount that was withheld? If there is withholding, you may be eligible for that money.

    > Do I need to add this to my tax return somehow?

    If the country you live in has a tax treaty with the US, its possible you can add this withheld amount on your tax returns and it will be applied as a credit.

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  27. James
    March 20th, 2014 at 05:54 | #27

    Hi Erich,
    I am an international student. By the end of January, I received my W2 form and I filed my return. I already got my money as return, but this week I receive the 1040s form, and the school did withhold money. Do I need to file an amend 1040 form or I can’t get this money any more?
    Thank you for your response!

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  28. James
    March 20th, 2014 at 06:38 | #28

    HI Erich,

    What if you already file tax return with your W2, then you receive a 1042S form with money withheld and you want to get some of this money withheld? would you file an amended tax return?
    FYI: I already get my tax return money from IRS.

    Thank you!

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  29. Giacomo
    March 22nd, 2014 at 10:51 | #29

    @Erich J. Ruth

    I would also appreciate information about this.

    I am in the very same situation: I rented a room via Airbnb, thus I received a 1042S.
    Aribnb did not withold anything.
    My country has no tax treaty with the US.
    On the 1040NR there is no line about 1042S with income code 13.

    Should I file the 1040NR and the 1042S separately?

    Best
    Giacomo

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  30. March 22nd, 2014 at 20:24 | #30

    You say “Aribnb did not withold anything”. Thats means you have nothing to do. If something was withheld, then you may have an opportunity to access that money.

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  31. DK
    March 23rd, 2014 at 01:15 | #31

    Hi,
    I am a non-resident alien working in United States. I’ve rented my room through airbnb and got 1042-S. Federal-tax withheld is $0.00 in 1042-S. In this case do I have to Include Gross income present in 1042-S in my 1040NR-EZ form ? If yes, do I just need to add it to Line 8 (Wages, Saleries, Tips etc ) and calculate the tax ? If I do not need to do anything, then do I need to attach 1042-S along with my employer W2 while filing returns ?

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  32. Rachel
    March 23rd, 2014 at 20:59 | #32

    I am also wondering about the 1042S. My husband is a resident alien (permanent resident with a green card) of the US, but received the 1042S from our Airbnb income. Airbnb did not withold anything. Where do we file this one our federal/state taxes? I’m struggling to find the correct category on TurboTax to file this additional income, even though it’s less than $2000. Any assistance would be so appreciated!
    Thank you!
    -Rachel

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  33. Francis Amrit
    March 25th, 2014 at 09:33 | #33

    Hi Eric,

    I am post doctoral researcher and am about to file my taxes as a resident this year since I now satisfy the substantial presence test (I arrived before January 1, 2012 – J1 scholar visa). However, I received a 1042-s along with a W2 this year. There is no tax withheld (both federal and state) on the 1042-s.

    Do I file 1040 separately and attach the 1042-s to the return and send it thorough the post? Is it that simple ?

    Thank you!
    Francis

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  34. A. D.
    March 25th, 2014 at 10:53 | #34

    @James
    I am in the exact same situation as James!!
    I already received my tax return from the IRS in early March and then March 18th, I received a 1042-S form for having rented out my room on Airbnb.

    I’m Canadian living and working in the US.

    Question: what is there left to do with this 1042-S form?!?!

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  35. Jen
    March 25th, 2014 at 16:22 | #35

    Hi Erich, I am from the Philippines. I opened a deposit account in one of the banks in the US in 2012 and closed it in January 2014. I received form 1042-s (copy b, c, d) from the bank. The income code is 29 which is deposit interest and the gross income is only $25. The withholding allowances is blank as well as net income. I do not know what to do with this form. I didn’t have any other form of income in 2013 aside from the deposit interest listed in Form 1042-s. Do I need to file any tax form with IRS? What do I need to do with this form? Thank you

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  36. fernan
    March 26th, 2014 at 13:57 | #36

    Hi there,

    Same question here. Rented apartment through Airbnb and now I have W-2 and 1042-S. I’m a non-resident alien from Spain (tax treaty). Airbnb didn’t withhold anything. Should I add the amount stated in 1042-S to my 1040NR line 18 (together with Schedule E for expenses)?

    Million thanks,

    Fernan

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  37. Alexandra
    March 28th, 2014 at 12:04 | #37

    James :
    HI Erich,
    What if you already file tax return with your W2, then you receive a 1042S form with money withheld and you want to get some of this money withheld? would you file an amended tax return?
    FYI: I already get my tax return money from IRS.
    Thank you!
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    I have the exact same question! I am a recipient of the 1042-S form. I rented out my room on Airbnb. I have income code 13. I am a Canadian (not US Citizen nor resident). I live and work in the US. I already filed my taxes for 2014 and received a refund. I’d like to know what are the steps to take if line item 2 on the form has $ associated with it.

    Thank you so much!

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  38. Ahsan Raza
    March 29th, 2014 at 08:20 | #38

    I am from Pakistan and I sell ebooks on amazon. today I received this form from amazon and it also has a box gross Income 660.54. it also says Foreign person US source income subject to withholding. I am totally lost why I received it and what to do next?

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  39. Fred
    March 29th, 2014 at 13:34 | #39

    Hello:
    I am not a US citizen and I don’t live in the US. A few days ago a Bond that I had, matured and the money was deposited in my US account. Yesterday the US bank where I have the account sent me a 1042S form (this is after march 15th 2014).
    The form was partially filled by the bank and they also wrote that the “information on this form is being furnished to the US-IRS”. Could you please give me a hint on what’s going on?
    What would you suggest me to do?
    Thanks.

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  40. Ellen
    March 30th, 2014 at 14:16 | #40

    Hi,
    I became a US resident (green card) last March having previously been a non-resident alien on a H1B. I received a 1042-S from my bank and am unsure what to do with it as I believe this is for non-residents. Do I just fill out the 1040 tax return and ignore this?
    Thanks,
    Ellen

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  41. Margo Robert
    March 31st, 2014 at 23:55 | #41

    I live out of U.S. and I received a 1042-S (Copies B, C & D only) Do I need to file these forms?

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  42. Margo Robert
    April 1st, 2014 at 00:06 | #42

    I own some UMDA shares and I live out of the U.S.
    I received a 1042-S (Copies B, C & D only) What do I do with these forms?

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  43. MN
    April 1st, 2014 at 05:29 | #43

    Hi Erich,
    I’m a non-resident Alien, and have received a lumpsum pension in 2013. I received form 1042-S from the withholding agent. Since I had submitted a W8-BEN form earlier the tax rate was 0 and there was no federal tax withholding. However, the exemption code on the form is 01 – Income effectively connected with business in the US. Shouldn’t the exemption code be 04 – Exempt under a tax treaty? My interpretation of code 01 is that I was connected with business in the US for the year 2013 which is not the case. Since I haven’t been in the U.S. nor connected with any business in the U.S. since 2005. Also can you please advice if I’m expected to file for returns in the US or this is only for record purpose. Will I have to pay any federal tax? Note – the tax for the amount received has already been paid in the country where I’m a resident. Thanks in advance

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  44. MN
    April 1st, 2014 at 12:10 | #44

    Hi Erich,
    I’m a non-resident Alien from India, and have received a lumpsum pension in 2013. I received form 1042-S from the withholding agent. Since I had submitted a W8-BEN form earlier the tax rate was 0 and there was no federal tax withholding. However, the exemption code on the form is 01 – Income effectively connected with business in the US. Shouldn’t the exemption code be 04 – Exempt under a tax treaty? My interpretation of code 01 is that I was connected with business in the US for the year 2013 which is not the case. Since I haven’t been in the U.S. nor connected with any business in the U.S. since 2005. Also can you please advice if I’m expected to file for returns in the US or this is only for record purpose. Will I have to pay any federal tax? Note – the tax for the amount received has already been paid in India. Thanks in advance

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  45. Suleyman
    April 3rd, 2014 at 19:25 | #45

    Hello

    I am an international master student in the USA. I am a non-resident person. They sent me 1042-s form. In this form everything is zero. What am I supposed to do? I have never worked or being employed in the USA. I have been receiving just my scholarship money monthly, coming from my country.

    Thanks in advance

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  46. MN
    April 5th, 2014 at 23:04 | #46

    @JP
    Hi JP,
    I was going through the comments posted on on this blog related to form 1042-S. I have received a form 1042-S this year with no withholding. Am a non-resident alien from India which has tax treaty benefits with U.S. It will help if you could please let me know how you proceeded and if you had to file your return. Thanks.

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  47. Julien
    April 8th, 2014 at 09:47 | #47

    Hello,
    i am a non resident, and I have a J-1 visa, As a marketing trainee, and I get paid.
    I get a W2 from my company.

    When I start the IRS process they ask me to pay $ 634 in addition of what my company already paid.
    Is it normal because I read that J-1 visa don’t pay taxes? Do I have to fill in addition the 1042 s ?

    Thanks for helping me

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  48. Annie
    April 8th, 2014 at 12:37 | #48

    How do I include the information on my 1042-S when I file tax if I am a resident alien (I’ve been here on student visa for 10 years and for the past 5 years I have been filing a 1040EZ instead of 1040NR). School gave me a considerable amount for scholarship and took a lot of tax out of it, which I had to pay out of my pocket. Should I file a 1040EZ and just let the IRS keep the withholding amount or should I file 1040NR-EZ?

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  49. Hely
    April 14th, 2014 at 18:08 | #49

    Hi Erich

    Your article is very clear and interesting. Thus, I think you can help me with my question.

    I am non-resident alien, always have lived outside USA and I never have worked or received any compensation from any USA company. However, the USA bank where I have a check account has sent me the 1042S form that I received 2 days ago.

    What should I do with the form if no one has withheld anything?

    Best Regards,

    Hely

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  50. Hely
    April 15th, 2014 at 08:58 | #50

    Hi Erich

    Your article is very clear and interesting. Thus, I think you can help me with my question.

    I am non-resident alien, always have lived outside USA and I never have worked or received any compensation from any USA company. However, the USA bank where I have a check account has sent me the 1042S form that I received 2 days ago.

    What should I do with the form if no one has withheld anything?
    What are the penalties for send the 1042S after the required date?

    Best Regards,

    Hely

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