Form 1042 & 1042-S

On Demand Webinar

Webinar Details $219

  • Rated:
  • Webinar Length: 100 Minutes
  • Guest Speaker:   Steven Mercatante
  • Topic:   Taxation and Accounting
  • Credit:   CPE 2.0, ATATX 1.5
All Access Membership

Ongoing IRS audits and recent changes in the law related to payments made to Non-US Persons means that the cost to your organization can be significant if it is not ready to accurately file Forms 1042/1042-S under Federal law. Start preparing for filing and reporting season now. Join us for a 100 minute webinar to discover:

  • How to distinguish payments to US and Non-US Persons
  • Ways to handle payee request for treaty benefits
  • Key elements of the troublesome IRS source-income rule
  • Updates on 1042/1042-S reporting regulations

Program Highlights:

IRS Form 1042-S Updates: What You Need to Know Right Now

  • IRS form updates: How recent laws have changed W-8/1042-S
  • How to fulfill reporting obligations via Form 1042, 1042-S

Avoiding Problematic Reporting & Withholding Issues: How to Ensure Error Free Filing

  • Making payments to US & Non-US Persons: Keys to getting it right
  • Ways to pin-point the key elements of the IRS source-income rule

Essential Checklist for Your 1042-S Filing. What To Know Before You Report

  • Additional documentation issues of Foreign Status and Treaty Claims
  • How to identify troublesome IRS source-income rule
  • Ways to break down W-8/1042/1042-S payee & payment reporting  situations
  • Avoiding penalties: Best practices for best results

Learning Objectives:

  • IRS form updates: How recent laws have changed W-8/1042-S
  • Making payments to US & Non-US Persons: Keys to getting it right
  • Ways to break down W-8/1042/1042-S payee & payment reporting  situations
  1. Introduction
  2. The Big Picture: 1042-S Audits Up! 00:03:17
  3. New W-8’s! - W-8BEN 00:13:43
  4. New W-8’s! - W-8BEN-E 00:
  5. New W-8’s! - W-8ECI 00:33:32
  6. New W-8’s! - W-8IMY 00:36:29
  7. The W-9 00:39:59
  8. W-9/W-8 Data Collection and Validation For 1042/1042-S Filing 00:45:19
  9. W-9/W-8 Data Collection and Validation - Doubting the Documentation 0048:40
  10. Must Have a W-9/W-8 Due Diligence Framework - Payments and Payees 00:50:00
  11.  W-9/W-8 Payee/Payment in Practice 00:50:23
  12. Who is My Payee - Non-U.S. Status Red Flags 00:52:43
  13. Who is My Payee - U.S. or Non-U.S.? 00:55:21
  14. Who is My Payee - Resident Alien Visas  00:56:46
  15. Who is My Payee - Resident Alien and Counting Days 00:59:41
  16. Who is My Payee - Special Entity Rules 01:01:46
  17. Who is My Payee - W-9 vs. W-9 Basic Rules 01:03:47
  18. 1042-S Reportable Income: Purchase Invoices 01:05:34
  19. 1042-S Reportable Income: How Income is Taxed 01:07:33
  20. W-8 Payment Sourcing 01:08:09
  21. W-8’s and Treaty Benefits 01:14:53
  22. Wrap-Up of General W-8 Validation Tips 01:21:49
  23. Filing Form 1042/1042-S 01:
  24. Filing Fundamentals  - Extensions 01:24:16
  25. Filing Fundamentals  - Recent Changes to Forms 1042-S Information Returns 01:29:12
  26. Filing Fundamentals –Recent Changes to Form 1042-S Information Returns Cont’d 01:30:22
  27. File on Time and Try to Avoid Those Penalties 01:37:17
  28. Protect Yourself 01:38:07
  29. Attendee Questions 01:39:54
  30. Presentation Closing 01:41:44

  • Audit 00:04:10, 00:13:29, 00:57:16
  • Backup Withholding 00:05:36, 00:23:13
  • Due Diligence 01:17:58, 01:32:30
  • EIN 00 50:37, 00:53:37
  • Exempt 00:45:38, 00:58:30, 01:20:02
  • Expatriate 00:57:41
  • FATCA 00:08:40, 00:25:50., 00:37:30, 00:42:48, 01:05:51
  • Federal Insurance Contributions Act (FICA) 00:58:31
  • FIRE - File Information Returns Electronically 00:14:23, 00:15:43
  • Foreign Taxpayer Identification Number - FTIN 00:21:46, 00:26:32
  • Form 1042 00:00:08, 00:10:59, 00:23:24, 00:40:03, 00:49:02, 01:05:44, 01:24:20
  • Form 1042-S 00:00:09, 00:06:30, 00:10:01, 00:11:01, 00:23:25, 00:40:03, 01:05:44, 01:24:21
  • Form 8233 00:45:19, 01:19:53
  • Form-MISC 00:08:17
  • Form W-8 00:06:21, 00:11:05, 00:19:55, 00:32:19, 00:40:02, 00:50:44, 00:56:31, 01:15:05
  • Form W-9 00:38:04, 00:40:06, 00:48:36, 00:50:28, 00:51:03, 01:16:41
  • Green Card Test 00:55:48, 00:57:24
  • Independent Contractor 01:20:11
  • Information Returns Intake System (IRIS) 00:14:24, 01:26:20
  • IRC Section 1446(f) 00:36:29
  • ITIN 00:50:36, 00:53:24
  • Nonresident Alien (NRA) 00:07:07, 00:20:05, 00:23:08, 00:25:40, 00:49:11, 00:51:25, 00:54:29, 01:05:41, 01:20:35
  • Publicly Traded Partnerships (PTP) 01:32:17
  • Reasonable Cause 01:19:40
  • Resident Alien 00:49:09, 00:54:27, 00:55:39, 00:58:16
  • Substantial Presence Test (SPT) 00:59:54
  • Tax Gap 00:05:04, 00:13:15
  • TIN 00:21:51, 00:22:53, 00:28:44, 00:53:09, 01:15:32, 01:31:01
  • Vendor 00:11:09, 00:14:28, 00:23:30, 00:45:07, 01:11:11, 01:15:15
  • W-8BEN 00:20:32, 00:23:27, 00:26:05
  • W-8BEN-E 00:25:13, 00:27:51, 00:46:00, 00:48:04, 01:12:55
  • W-8ECI 00:33:37, 00:46:00, 01:12:52
  • W-8EXP 00:45:34, 00:46:14
  • W-8IMY 00:36:29, 00:37:59, 00:48:17
  • Wage 00:57:40

Audit: A formal examination of an organization's or individual's accounts or financial situation

Backup Withholding: Backup withholding is the tax that is levied on investment income, at an established tax rate, as the investor withdraws it. Backup withholding helps to ensure that government tax-collecting agencies (such as the IRS or Canada Revenue Agency) will be able to receive income taxes owed to them from investors' earnings. (www.investopedia.com)

Due Diligence: Due diligence is a process or effort to collect and analyze information before making a decision or conducting a transaction so a party is not held legally liable for any loss or damage. The term applies to many situations but most notably to business transactions.

EIN: The Employer Identification Number, also known as the Federal Employer Identification Number or the Federal Tax Identification Number, is a unique nine-digit number assigned by the Internal Revenue Service to business entities operating in the United States for the purposes of identification.

Exempt : Exempt employee is a term that refers to a category of employees set out in the Fair Labor Standards Act. They do not receive overtime pay, nor do they qualify for the minimum wage

Expatriate: An expatriate (often shortened to expat) is a person residing in a country other than their native country. ... However, the term 'expatriate' is also used for retirees and others who have chosen to live outside their native country. Historically, it has also referred to exiles.

FATCA: FATCA was enacted in 2010 by Congress to target non-compliance by U.S. taxpayers using foreign accounts. FATCA requires foreign financial institutions (FFIs) to report to the IRS information about financial accounts held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold a substantial ownership interest. (www.treasury.gov). FACTA (Fair and Accurate Credit Transactions Act) is an amendment to FCRA (Fair Credit Reporting Act ) that was added, primarily, to protect consumers from identity theft. The Act stipulates requirements for information privacy, accuracy and disposal and limits the ways consumer information can be shared.

FIRE - File Information Returns Electronically: The IRS FIRE system is the electronic network used to accept and process most types of filing forms. Technically, it stands for File Information Returns Electronically.

Federal Insurance Contributions Act (FICA): The Federal Insurance Contributions Act is a United States federal payroll contribution directed towards both employees and employers to fund Social Security and Medicare—federal programs that provide benefits for retirees, people with disabilities, and children of deceased workers.

Foreign Taxpayer Identification Number - FTIN: An FTIN is a taxpayer identification number issued by a country other than the United States. If aforeign person does not provide its FTIN, it must provide the withholding agent with an explanation ofwhy an FTIN has not been provided.

Form 1042: Form 1042, also "Annual Withholding Tax Return for U.S. Source Income of Foreign Persons", is used to report tax withheld on certain income of foreign persons.

Form 1042-S: Form 1042-S is used to report amounts paid to foreign persons (including persons presumed to be foreign) who are subject to income tax withholding. For an individual taxpayer, Form 1042-S is a document provided to you (and the IRS) by the payer of the income reported.

Form 1099-MISC: The Form 1099-MISC is an Internal Revenue Service (IRS) tax return document used to report miscellaneous payments made to nonemployee individuals, such as independent contractors, during the calendar year. (www.shrm.org)

Form 8233: IRS Form 8233 must be completed when a non U.S. citizen is claiming tax treaty exemption from income taxes for income received for services provided as an independent contractor.

Form W-8: Form W-8 is filled out by foreign entities (citizens and corporations) in order to claim exempt status from certain tax withholdings. The form is used to declare an entity's status as non-resident alien or foreign national who works outside of the United States.

Form W-9: Form W-9 (officially, the "Request for Taxpayer Identification Number and Certification") is used in the United States income tax system by a third party who must file an information return with the Internal Revenue Service (IRS). It requests the name, address, and taxpayer identification information of a taxpayer (in the form of a Social Security Number or Employer Identification Number). - Wikipedia (https://en.m.wikipedia.org/)

Green Card Test: You are a resident, for U.S. federal tax purposes, if you are a lawful permanent resident of the United States at any time during the calendar year. This is known as the "green card" test. You are a lawful permanent resident of the United States, at any time, if you have been given the privilege, according to the immigration laws, of residing permanently in the United States as an immigrant. You generally have this status if the U.S. Citizenship and Immigration Services (USCIS) issued you a Permanent Resident Card, Form I-551, also known as a "green card."

IRC Section 1446(f): Under IRC section 1446(f), if the foreign partner has gain on the sale or exchange of a partnership interest, the purchaser/transferee of the partnership interest must withhold 10% of the amount realized on that sale or exchange, unless the transaction qualifies for a full or partial exception

ITIN : An Individual Taxpayer Identification Number is a United States tax processing number issued by the Internal Revenue Service. It is a nine-digit number that begins with the number 9, and the 4th and 5th digits, also known as second section, range from 70 to 88, 90 to 92 and 94 to 99.

Independent Contractor: An independent contractor is a person or entity contracted to perform work or provide services to another entity as a non-employee. As a result, independent contractors must pay their own Social Security and Medicare taxes. - Investopedia (https://www.investopedia.com/)

Information Returns Intake System (IRIS): The Information Returns Intake System (IRIS) Taxpayer Portal is a system that provides a no cost online. method for taxpayers to electronically file Form 1099 series. The Taxpayer Portal allows you to enter. data to create Forms 1099 by either keying in the information or uploading a .csv file.

Nonresident Alien (NRA): This income is taxed at a flat 30% rate, unless a tax treaty specifies a lower rate. Nonresident aliens must file and pay any tax due using Form 1040NR, U.S. Nonresident Alien Income Tax Return or Form 1040NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens with No Dependents.

Publicly Traded Partnerships (PTP): A publicly traded partnership (PTP) is a business organization owned by two or more co-owners whose shares are regularly traded on an established securities market. A publicly traded partnership is a type of limited partnership managed by two or more general partners—including individuals, corporations, or other partnerships—and is capitalized by limited partners who provide capital but have no management role in the partnership.

Reasonable Cause : Reasonable cause is based on all the facts and circumstances in your situation. The IRS will consider any reason which establishes that you used all ordinary business care and prudence to meet your federal tax obligations but were nevertheless unable to do so.

Resident Alien : A resident alien is a foreign person who is a permanent resident of the country in which he or she resides but does not have citizenship. To fall under this classification in the United States, a person needs to either have a current green card or have had one in the previous calendar year.

Substantial Presence Test (SPT) : The Substantial Presence Test (SPT) is a criterion used by the Internal Revenue Service (IRS) in the United States to determine whether an individual who is not a citizen or lawful permanent resident in the recent past qualifies as a "resident for tax purposes" or a "nonresident for tax purposes"; it is a form of physical presence test. The SPT should be used in conjunction with the Green Card Test (the criterion that the individual possessed a valid Green Card at any time of the year). An individual who satisfies either one or both of these tests is treated as a resident for tax purposes.

TIN: A Taxpayer Identification Number is an identifying number used for tax purposes in the United States and in other countries under the Common Reporting Standard. In the United States, it is also known as a Tax Identification Number or Federal Taxpayer Identification Number.

Tax Gap: The gross tax gap is the difference between true tax liability for a given tax year and the amount that is paid on time. It is comprised of the nonfiling gap, the underreporting gap, and the underpayment (or remittance) gap.

Vendor: A vendor is a person or business that supplies goods or services to a company. Another term for the vendor is the supplier. In many situations, a company presents the vendor with a purchase order stating the goods or services needed, the price, delivery date, and other terms.

W-8BEN: Form W8-BEN, Certificate of Foreign Status of Beneficial Owner for U.S. Tax Withholding, is used by a foreign person to establish both foreign status and beneficial ownership, and to claim income tax treaty benefits with respect to income other than compensation for personal services. Give Form W-8 BEN to the withholding agent or payer if you are a foreign person and you are the beneficial owner of an amount subject to withholding. Submit Form W-8 BEN when requested by the withholding agent or payer whether or not you are claiming a reduced rate of, or exemption from, withholding.

W-8BEN-E: W-8BEN-E is an important tax document which allows businesses operating outside of the U.S. to claim tax exemption on U.S.-sourced income. The official document title is Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities).

W-8ECI: Form W-8ECI is the Certificate of Foreign Person's Claim for Exemption From Withholding on Income Effectively Connected With the Conduct of a Trade or Business in the United States. You must give Form W-8 ECI to the withholding agent or payer if you are a foreign person and you are the beneficial owner of U.S. source income that is (or is deemed to be) effectively connected with the conduct of a trade or business within the United States.

W-8EXP: A foreign government must provide Form W-8EXP to establish eligibility for exemption from withholding for payments exempt from tax under section 892 or for purposes of establishing its status as an exempt beneficial owner.

W-8IMY: This form may serve to establish foreign status for purposes of sections 1441, 1442, and 1446. The W-8IMY is used by an intermediary, a withholding foreign partnership, a withholding foreign trust, or flow-through entity.

Wage: A fixed regular payment, typically paid on a daily or weekly basis, made by an employer to an employee, especially to a manual or unskilled worker.


Guest Speaker

  • Steven Mercatante

CPE Credit

Continuing Professional Education

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ATATX Credit

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