The United States has income tax treaties with many countries that may allow nonresident aliens to claim a reduced withholding rate or even a full refund (withholding credit) on amounts reported on Form 1042-S.
Whether you qualify for a total withholding credit (full refund of tax withheld) depends on the specific treaty provisions and the type of income you received.
Countries With U.S. Tax Treaties
As of the latest updates, the U.S. has tax treaties with the following countries:
Armenia • Australia • Austria • Azerbaijan • Bangladesh • Barbados • Belarus • Belgium • Bulgaria • Canada • China (excluding Hong Kong & Macau) • Cyprus • Czech Republic • Denmark • Egypt • Estonia • Finland • France • Georgia • Germany • Greece • Hungary • Iceland • India • Indonesia • Ireland • Israel • Italy • Jamaica • Japan • Kazakhstan • Korea (South Korea) • Kyrgyzstan • Latvia • Lithuania • Luxembourg • Malta • Mexico • Moldova • Morocco • Netherlands • New Zealand • Norway • Pakistan • Philippines • Poland • Portugal • Romania • Russia • Slovak Republic • Slovenia • South Africa • Spain • Sri Lanka • Sweden • Switzerland • Tajikistan • Thailand • Trinidad & Tobago • Tunisia • Turkey • Turkmenistan • Ukraine • United Kingdom • Uzbekistan • Venezuela
Eligibility for a Total Withholding Credit
Having a treaty does not guarantee a refund. You must check:
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Type of income received (wages, royalties, dividends, scholarships, etc.).
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Treaty rate for that income — some treaties reduce withholding to 0%.
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Proper filing — you must claim benefits by filing Form 1040-NR.
Common Income Types That May Qualify for 0% Withholding
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Scholarships & Fellowships – Some treaties exempt scholarship or research income for students/teachers.
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Government Compensation – Certain foreign government employees working in the U.S. may be fully exempt.
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Royalties & Interest Payments – Some treaties reduce U.S. withholding to 0%.
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Business Profits – Nonresidents without a permanent U.S. establishment may qualify for exemption.
How to Claim a Refund
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Confirm that your country’s treaty covers your income type.
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Review IRS Publication 901 (U.S. Tax Treaties) or the IRS website.
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File Form 1040-NR (U.S. Nonresident Alien Income Tax Return).
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Attach Form 8833 if required (Treaty-Based Return Position Disclosure).
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Report your Form 1042-S withholding credit to claim your refund.
Key Takeaways
✔ The U.S. has tax treaties with 66 countries.
✔ Eligibility for a full withholding credit depends on your income type and treaty rules.
✔ Common exemptions: scholarships, interest, royalties, and business profits.
✔ Nonresidents must file Form 1040-NR and properly claim treaty benefits to receive a refund.