Section 46 - Schedule NEC

Section 46 contains Data from Schedule NEC, Tax on Income Not Effectively Connected With a U.S. Trade or Business, Form 1040-NR.

With the redesign of Form 1040-NR for TY20, Schedule NEC is removed from Form 1040-NR and will be filed as a separate schedule. TY19 and prior, Schedule NEC was page 4, part of Form 1040-NR.

The taxpayer uses Schedule NEC, of Form 1040-NR, to compute tax on Income not effectively connected with a U.S. trade or business.

Types Schedule NEC income include:

Dividends paid by U.S. or foreign corporations.

Dividend equivalent payments received with respect to IRC 871(m) transactions.

Interest paid by foreign corporation, mortgage or other types.

Industrial royalties (patent, trademarks, etc.).

Motion pictures or TV copyright royalties.

Other royalties (copyrights, recording, publishing, etc.)

Real property income and natural resource royalties.

Pensions and annuities.

Social security benefits.

Gains (include capital gain from line 18 below).

Gambling winnings

The tax on income not effectively connected with a U.S. trade or business is entered on line 15, Schedule NEC and transferred to page 2, line 23a, of Form 1040-NR (TY19, line 54, of Form 1040-NR).

Section 46 contains the following Fields

Form 1040-NR

Field Title

4613A

10 percent Tax Rate Total Income

4613B

15 percent Tax Rate Total Income

4613C

30 percent Tax Rate Total Income

46TR1

Tax Rate Income Taxpayer Percentage 1

46TR2

Tax Rate Income Taxpayer Percentage 2

46131

XX percent Tax Rate Total Income

46132

YY percent Tax Rate Total Income

46OM1

Effectively Connected Income First Year Election

46OM2

Effectively Connected Income Continuing Election Indicator

This field is transcribed from Column (d) 1 as a percentage using three digits.