Forms 1042, 1042-S, and 1042-T:
A Comprehensive Guide

Who is Required to File Forms 1042 and 1042-S?

Forms 1042 and 1042-S are generally filed by withholding agents. The IRS defines a withholding agent as any U.S. or foreign person who manages, gets, holds, uses, or pays any income on behalf of a foreign person subject to withholding. Therefore, a withholding agent can be an individual, corporation, government agency, estate, partnership, or even a tax-exempt foundation.

Simply put, individuals and entities that make payments subject to U.S. income tax withholding to foreign individuals must file Form 1042 or 1042-S to report them.

What are the Key Differences between Forms 1042 and 1042-S?

There are similarities between these tax forms, however, there is a key difference. The main difference between these forms lies in the amounts they report. Form 1042 is an annual withholding tax return that is focused on reporting the tax withheld from income that foreign persons generated in the U.S. On the other hand, Form 1042-S is focused on the payments made to foreign persons rather than the withholding amounts.

What are the Filing Deadlines for Form 1042, 1042-S, and 1042-T?

The deadline for filing both Forms 1042 and 1042-S with the IRS is March 17, 2025. This is also the deadline for furnishing all recipients with a form copy. There is no specific deadline for filing Form 1042-T as this is a transmittal form and is only required when paper copies of forms are filed with the IRS.

Is there an Extension of Time to File Forms 1042 and 1042-S?

Yes, withholding agents that require more time to file Forms 1042 and 1042-S do have the option to request an IRS extension of time to file. However, it is very important to be aware of the fact that two different extension forms must be filed to request the extension.

• Form 8809 can be filed to request an extension of up to 30 days for filing
  Form 1042-S.
• Form 7004 can be filed to request an extension of up to 6 months.

Regardless of the extension filed for either Form 1042 or 1042-S, there is no extension for the deadline to make
tax payments.

Late Filing Penalties for Forms 1042 and 1042-S

If the withholding agent fails to file Form 1042-S by the deadline or files with incorrect data, they can be penalized up from $60 to $330 per form. The penalty amount depends on the time elapsed between the deadline and when the form is filed. The annual maximum penalties differ depending on the size of the business, and all penalty amounts may change year by year.

How Do I File Forms 1042 and 1042-S with TaxBandits?

With TaxBandits, an IRS-authorized e-file provider, you can quickly and securely e-file Form 1042 and 1042-S while receiving instant status updates on your submission. Our streamlined process enhances accuracy, minimizes errors, and ensures compliance with IRS regulations.

Simply follow these steps to complete and file Forms 1042 and 1042-S with TaxBandits.

• Step 1: Create an account & choose
  Form 1042-S
• Step 2: Enter 1042-S Form Information
• Step 3: Review and Transmit 1042-S to IRS
• Step 4: Distribute Recipient Copies via Postal Mailing and/or
  Online Access services.