For IRS Form 1042-S, do I report each payment separately or the total amount paid for a tax year?

For IRS Form 1042-S, you generally report each payment separately rather than just the total amount paid for the tax year. Here’s how to approach reporting:

Key Points for Reporting on Form 1042-S

1. Separate Payments:
   • Each type of income payment to a non-resident alien must be reported separately on its own Form 1042-S. This includes payments such as scholarships, fellowships, royalties, or compensation for services.
2. Multiple Forms for Multiple Payments:
   • If you made multiple payments to the same non-resident recipient during the tax year, you must file a separate Form 1042-S for each payment or type of payment.
3. Details Required:
   • Each Form 1042-S should include:
     • The recipient’s information (name, address, TIN/FTIN)
     • The specific amount paid for that transaction
     • The type of income (indicated by the appropriate code in Box 3)
     • Any federal tax withheld (reported in Box 4)
4. Total Reporting:
   • If a recipient received various types of income (e.g., royalties and fees for services), you would need to issue different forms for each type, detailing the amount and withholding for that specific type of income.

Conclusion

You must report each payment separately on Form 1042-S to ensure compliance with IRS requirements. Accurate reporting helps avoid penalties and provides the recipient with the correct information for their tax reporting. Always consult the latest IRS instructions or a tax professional for specific cases, as regulations and requirements may change.