close
close

How to complete Form 1042-S for third-party withholding tax reporting if you are not a U.S. citizen

How to complete Form 1042-S for third-party withholding tax reporting if you are not a U.S. citizen
How to complete Form 1042-S for third-party withholding tax reporting if you are not a U.S. citizen

If you’re one of several thousand people who were affected by over-withholding on a brokerage deal, you may be issued a Form 1042-S. This has been a problem for a significant number of taxpayers, so here are the steps you need to take to get the over-withheld amount back. If a brokerage firm issued you a Form 1042-S for the 2023 tax year because funds from a stock conversion you were involved in were withheld and paid to the IRS, the only way to get the over-withheld amount back after March 15, 2024, is to file a refund claim. In this case, a refund claim is a U.S. tax return requesting a refund.

If you are an individual and not a U.S. resident, you generally must file a Form 1040-NR. Before you file a Form 1040-NR, you must obtain an Individual Taxpayer Identification Number (ITIN) from the IRS.

If you are an individual and a U.S. resident, you must claim the excess withheld amount on your 1040 tax form.

Because of the statute of limitations, you can only file a refund claim within three (3) years from the date of issuance of Form 1042-S. After that, you will not be able to get a refund for the excess amounts withheld.

What is an ITIN and why do I need it?

Individual Taxpayer Identification Number | Internal Revenue Service (irs.gov)

TAS Help Page – How to get an ITIN

Obtaining an ITIN – Taxpayer Advocate Service (irs.gov)

IRS Tax Topic No. 857 – ITINs

Topic No. 857, Individual Taxpayer Identification Number (ITIN) | Internal Revenue Service (irs.gov)

How do I apply for an ITIN?

How do I apply for an ITIN? | Internal Revenue Service (irs.gov)

Obtaining an ITIN from abroad:

Obtaining an ITIN from abroad | Internal Revenue Service (irs.gov)

IRS video on obtaining an ITIN:

How to get an individual tax identification number – YouTube

Additional resources:

Remember that you have the right not to pay more than the correct amount of tax. Find out more about this and other rights as a taxpayer in the Taxpayers’ Bill of Rights.

Leave a Reply

Your email address will not be published. Required fields are marked *