FATCA - Draft instructions for Form 1042 for 2014 

November 7: The IRS posted a draft version (as of November 6, 2013) of the instructions for Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons.

The Form 1042 draft instructions [PDF 329 KB] explain that Form 1042 for 2014 has been modified primarily for withholding agents to report payments and amounts withheld under the FATCA* provisions (in addition to those payments and amounts withheld and required to be reported under Chapter 3 of the Code).


*Foreign Account Tax Compliance Act provisions that are contained in Chapter 4 of the Code.


Form 1042 is used to report tax withheld for FATCA purposes for payments made to entities that are classified as nonparticipating foreign financial institutions, certain passive nonfinancial foreign entities, and “recalcitrant” account holders of participating and registered deemed-compliant foreign financial institutions.


Form 1042 is also used to report payments reported on Form 1042-S.


The IRS released a draft Form 1042 [PDF 142 KB] for 2014 in April 2013. It has not yet been finalized.




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