0924 Publ 6024 (PDF)

Official source: IRS Forms, Instructions & Publications (https://www.irs.gov/pub/irs-pdf/p6024.pdf), retrieved 2026-10-03. U.S. Government work (17 U.S.C. § 105).

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Generally, a foreign recipient is subject to a 30% U.S. withholding tax on its U.S.- source income. A reduced rate, including exemption, may apply if an Internal Revenue Code section provides for a lower rate or there is a tax treaty between the foreign person’s country of residence and the United States.

The Internal Revenue Service Statistics of Income (SOI) Division produces an annual collection of aggregate statistics from the population of Forms 1042-S filed annually by withholding agents to report U.S.-source income paid to foreign recipients and the tax withheld on that income.

• Of the nearly 9 million returns filed, 55.5% were subject to withholding tax.

• Of the $945.1 billion of U.S. income payments reported to foreign recipients on Form 1042-S, 13.7% were subject to withholding.

• The average withholding rate of U.S.-source income payments subject to withholding tax was 16.9%.

• Interest (42.1%) and dividends (25.8%) accounted for most of the income.

• 83.5% of dividends were subject to withholding taxes, compared to just 2.8% of interest.

• 82.9% of U.S.-source income payments were made to individuals but those payments accounted for just 19% of total income.

• Corporations received 9.2% of all U.S.-source income payments to foreign recipients, but accounted for 57.3% of total income and 54.1% of total taxes withheld.

• Foreign recipients from countries having a reciprocal tax treaty with the U.S. received 78% of total income and paid 75.1% of total tax withheld.

• Recipients from the U.K. ($110.1 billion) received the most U.S.-source income of any country.

Percentage of Total U.S.-Source Income Paid to Foreign Persons and Income Subject to Withholding Under Chapter 3, as Reported on Form 1042-S, by Selected Income Category, Calendar Year 2021

Income category

Interest

Dividends

Rents and royalties

Notional principal contract income [1]

Return on capital

Personal services

Social Security

and railroad retirement benefits

Other

[1] Additional information about notional principal contract income is available in the Statistics of Income Bulletin (Fall 2023), Foreign Recipients of U.S. Income, Calendar Year 2019. NOTES: Form 1042-S, Foreign Person's U.S.-Source Income Subject to Withholding. Chapter 3 of the Internal Revenue Code (Sections 1441–1446) generally requires withholding at a rate of 30% on US-source fixed or determinable, annual or periodic income paid to nonresident aliens.

Foreign Recipients of U.S. Income Under Chapter 3 Withholding Forms 1042S: Number, U.S. Tax Withheld, and U.S.-Source Income, by Principal Types of Income, Selected Recipient Types, and Selected Countries of Recipients, 2021

[Money amounts are in thousands of dollars]

Principal types of U.S.-source income

Total U.S.-

source income

Interest Dividends

income

Recipient types and selected country

[1] and selected recipient type

of Forms Number 1042S withheldU.S. tax

Return on capital

Social Security and railroad

retirement

payments

Personal

services

Notional principal

contract

Rents

and royalties

income

Publication 6024 (9–2024) Catalog Number 95329E Department of the Treasury Internal Revenue Service www.irs.gov