What to Do When You Receive a 1042-S: A Simple Guide

Well, sometimes getting a tax form is totally confusing, most of all when you really do not understand what it says. Now that you just received the 1042-S, perhaps you may be asking yourself, “What should I do now?” So, do not worry! This article will guide you in order to understand what it’s all about and help you move on with your next steps. Let’s dive right in!

What is a 1042-S Form?

A 1042-S is a form used in the United States to report income earned by nonresidents. That includes foreign students, working individuals, and just about anyone who derives income from US sources. Being in receipt of this form indicates you made money in the U.S. subject to taxation.

Some of the most common items reported on Form 1042-S are:

• Scholarships and fellowships
• Royalties
• Interest
• Dividends

Why Did You Get a 1042-S?

You may get a 1042-S for just one of several reasons. Here are a few of them:

• Work: If you worked in the U.S. and earned some money, that should be reported by your employer.
• Scholarships: If you’re a student and you receive a scholarship, that should be reported on this form.
• Investments: If you have investments in the U.S. that earned income, it probably will be reported.

What Should You Do Next?

Now that you know what a 1042-S form is, let’s go over what to do once you get it. Here’s your easy checklist to follow.

Review the Form:

• Your name and address are correct.
• Your amounts of income is how much money was reported.

Determine Your Tax Status:

• Are you a Non-Resident Alien? Then, likely you must file the US tax return.
• This form is highly essential for an individual residing in another country and earning income in the United States.

Other Attachments:

• Tax forms such as W-2 or 1099s.
• Any type of record which may substantiate income.

Do You Must File a Tax Return?

You almost always must file a tax return if you have income earned in the United States. Information from your 1042-S can be used to prepare and complete your tax return.

How to Prepare Your Tax Return:

• File online or on paper.
• Use tax software to help, or hire someone to do it for you.

Pay Any Taxes You Owe

Pay by the tax due date to avoid penalty for taxes you owe on your 1042-S. If you think you overpaid in taxes, you may be due a refund.

Key Dates

As you work on your taxes, it’s always good to remember any deadline. Here are a few key deadlines:

• April 15: This would be tax filing day, although the actual date may fall on a weekend or holiday.
• Form 1042-S Distribution Date: You will have to receive this form by March 15 of the following year.

Frequently Asked Questions About the 1042-S

Let’s walk through some of the most common questions people get about a 1042-S.

1. If I got a 1042-S, do I have to file taxes? Yeah, generally. Unless your U.S. income was only from the rental of an apartment, if you earned any U.S. income and received a 1042-S, most likely you are going to need to file.
2. How can I get my money back? Chances are that if you’ve overpaid tax with these installments, you should get some or all of that back. For further assistance with ITIN applications, check out our ITIN page.
3. If I don’t understand some of the things on this form? You don’t need to be a tax expert. If you do have questions for a tax professional, ask them to explain it. He or she will be more than happy to answer all your questions and make sure everything is complete correctly.

Nice to Know

The following are some additional pointers to make everything easy:

• Keep Copies: Always have a copy of your Form 1042-S, and with tax returns you file.
• Collect: Collect all your tax documents in one folder.
• Ask Questions: Don’t be afraid to ask questions if you don’t know. All the way from a resource you can get from a tax professional all the way to online forums, there’s always a venue for aid.

Conclusion

Of course, receiving a 1042-S can be intimidating. Now that you know what it is, you’ll know what to do with it. You will examine it, gather what it needs for preparation, and determine whether you should file a return, thereby gaining control of your tax matters with confidence. After all, help is always okay. You’re going to do your taxes like a pro if you get it right.