Form 1042 Due Date for 2023

2. What information is required to file Form 1042?

Form 1042 requires the following information:

• Withholding agent Information: Name, Employer identification number, Chapter 3 and 4 status codes, Street, City or town, country, and zip or foreign postal code
• Section 1: The record of the Federal Tax Liability
• Section 2: Reconciliation of U.S. Source FDAP Income
• Section 3: Potential Section 871(m) Transactions
• Section 4: Dividend Equivalent Payments by a Qualified Derivatives Dealer (QDD)

Visit https://www.taxbandits.com/1042-forms/form-1042-instructions/ for more detailed information about Form 1042 instructions.

3. What are the new Electronic Filing Requirements for Form 1042?

Form 1042 requires electronic filing for the 2023 tax year. Withholding agents, notably financial institutions and those submitting ten or more information returns each year and partnerships with more than 100 partners, must file Form 1042 electronically with the IRS beginning in the 2023 tax year. However, in response to input from Withholding agents regarding concerns with the electronic filing of Form 1042, the IRS has announced that the e-filing requirement would be delayed.

According to IRS Notice 2024-26, for the year 2024, people or institutions in the U.S. that withhold taxes are exempt from the new e-filing requirement. Foreign withholding agents will be exempt for the 2024 and 2025 calendar years.

However, the IRS highly recommends withholding agents to file 1042 electronically for the 2023 tax year for secure filing experience.

4. How to extend my Form 1042 Deadline?

You can extend your time for filing Form 1042 with the IRS by requesting an extension request for up to 6 months by filing Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns. Please keep in mind that this extension is just for filing purposes and has no impact on the IRS payment deadline.

5. What are the 1042 late filing penalties?

• Late filing of Form 1042: If you don't file Form 1042 on time with the IRS, it can result in a penalty. The penalty ranges from 5% to 25% of the unpaid tax for each month or part of a month your return is late.
• Late tax payment: There's another penalty if you don't pay the tax on time. This penalty typically ranges from 1% to 25% of the unpaid tax for each month or part of a month the tax remains unpaid. However, the total penalty for late payment of tax does not exceed 25%.
• Other penalties: You could face penalties for being careless, making a big mistake in your tax amount, or intentionally trying to trick the tax system.

Visit https://www.taxbandits.com/1042-forms/form-1042-penalty/ to learn more information about Form 1042 penalties.

6. E-file Form 1042 with TaxBandits

Despite the fact the IRS has temporarily delayed the new e-filing requirement for Form 1042, the IRS still recommends withholding agents to file 1042 online for easy and secure filing. Here’s where TaxBandits comes in!

TaxBandits is an IRS-authorized e-file service provider that provides the best Form 1042 e-filing experience. With TaxBandits,

• E-sign your 1042 form using Form 8453-WH (or) Form 8879-WH to make the electronic filing experience of Form 1042 seamless.
• You are provided with the best Customer support, available 24/7 via phone, email, and live chat.
• Supports Schedule Q (Form 1042) for Qualified Derivatives Dealers (QDD) while filing Form 1042 with the IRS.

Want to e-file Form 1042 with the IRS? Get started with TaxBandits today.