Annual Withholding Tax Return for OMB No. 1545-0096

U.S. Source Income of Foreign Persons Form 1042

Department of the Treasury

Internal Revenue Service  See instructions.

Name of withholding agent Employer identification number

Number, street, and room or suite no. (if a P.O. box, see instructions)

For IRS Use Only

CC FD

RD FF

City or town, state, and ZIP code

CAF FP

CR I

EDC SIC

62 For all Form(s) 1042-S and 1000: a Gross income paid b Taxes withheld or assumed

64 Total paid by Federal tax deposit coupons or by electronic funds

transfer (or with a request for an extension of time to file) for 2002 64

65 Enter overpayment applied as a credit from 2001 Form 1042 65

67 Total payments. Add lines 64 through 66  67

68 If line 63c is larger than line 67, enter balance due here 68

69 If line 67 is larger than line 63c, enter overpayment here 69

71 Apply overpayment on line 69 to (check one): Credit on 2003 Form 1042 or Refund

If you will not be liable for returns in the future, check here 

For Privacy Act and Paperwork Reduction Act Notice, see the instructions. Cat. No. 11384V Form 1042 (2002)

Check here if you made quarter-monthly deposits using the 90% rule (see Deposit Requirements in the instructions) 

If this is an amended return, check here 

Enter date final income paid 

Check if you are a:

66 Credit for amounts withheld by other withholding agents (see inst.) 66

63a Total tax liability (add monthly total lines from above) 63a

63b

Total net tax liability (combine lines 63a and 63b)  63c

b Adjustments (see instructions)

c

70 Penalty for failure to deposit tax when due. Also include on line 68 or line 69 (see instructions) 70

Record of Federal Tax Liability

(Do not show Federal tax deposits here.)

Tax liability for period

(including any taxes assumed

on Form(s) 1000)

Period

ending

Line

No.

1 7 41 7

2 15 42 15 Jan. Sept. 3 22 43 22

4 31 44 30

5 Jan. total 45 Sept. total

6 7 46 7

7 15 47 15 Feb. Oct. 8 22 48 22

9 28 49 31

10 Feb. total 50 Oct. total

11 7 31 7 51 7

12 15 32 15 52 15 Mar. July Nov. 13 22 33 22 53 22

14 31 34 31 54 30

15 Mar. total 35 July total 55 Nov. total

16 7 36 7 56 7

17 15 37 15 57 15 Apr. Aug. Dec. 18 22 38 22 58 22

19 30 39 31 59 31

20 Apr. total 40 Aug. total 60 Dec. total

21 7

22 15 May 23 22

24 31

25 May total

26 7

27 15 June 28 22

29 30

30 June total

Tax liability for period

(including any taxes assumed

on Form(s) 1000)

Period

ending

Line

No.

Tax liability for period

(including any taxes assumed

on Form(s) 1000)

Period

ending

Line

No.

61 No. of Forms 1042-S filed: a On magnetic media b On paper c Electronically

Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and

belief, it is true, correct, and complete. Declaration of preparer (other than withholding agent) is based on all information of which preparer has any knowledge. Sign

Here Your signature Date

Date Preparer’s SSN or PTIN Preparer’s

signature Check if

self-employed  Paid

Preparer’s

Use Only Firm’s name (or

yours if self-employed),

address, and ZIP code

EIN 

Phone no.





Capacity in which acting 

 Daytime phone number 

NQI/Flow-through entity (See instructions.)

2002

QI/Withholding foreign partnership or trust
General Instructions

Purpose of Form

Use Form 1042 to report tax withheld on

certain income of nonresident aliens,

foreign partnerships, foreign

corporations, and nonresident alien or

foreign fiduciaries of estates or trusts.

Who Must File

Every withholding agent or intermediary

(see definitions below) who receives,

controls, has custody of, disposes of, or

pays any fixed or determinable annual or

periodical income must file an annual

return for the preceding calendar year

on Form 1042.

Where and When To File

File Form 1042 with the Internal

Revenue Service Center, Philadelphia,

PA 19255, by March 17, 2003. Also send

amended returns to this address. Use

Form 1042-T to transmit paper Forms

1042-S.

Extension of time to file. If you need

more time to file Form 1042, you may

submit Form 2758, Application for

Extension of Time To File Certain Excise,

Income, Information, and Other Returns.

Withholding Agent

Any person required to withhold tax is a

withholding agent. A withholding agent

may be an individual, trust, estate,

partnership, corporation, government

agency, association, or tax-exempt

foundation, whether domestic or foreign.

Section references are to the Internal

Revenue Code unless otherwise noted.

Income Tax Withholding on

Wages, Pensions, Annuities,

and Certain Other Deferred

Income

Use Form 941, Employer’s Quarterly

Federal Tax Return, to report any income

tax, social security tax, and Medicare

tax withheld on wages paid to a

nonresident alien employee.

Deposit Requirements

Generally, if you are not required to use

the Electronic Federal Tax Payment

System (EFTPS), you must deposit the

tax withheld and required to be shown

on Form 1042 with an authorized

financial institution using your preprinted

Form 8109, Federal Tax Deposit

Coupon. Do not use anyone else’s

coupons. If you do not have your

coupons when a deposit is due, call

1-800-829-4933, if you are in the

United States. If overseas, call

215-516-2000 (not a toll-free number)

from 6:00 a.m. to 2:00 a.m. Eastern

time. You may also contact your local

IRS office. To avoid a penalty, do not

mail your deposits directly to the IRS.

Form 1042 (2002) Page 2

Additional Information

For details on withholding of tax, get

Pub. 515, Withholding of Tax on

Nonresident Aliens and Foreign

Entities, by calling 1-800-TAX-FORM

(1-800-829-3676) or by downloading it

from the IRS Web Site at www.irs.gov.

Note: Every person required to deduct

and withhold any tax under Chapter 3 of

the Code is liable for such tax. See

section 1461.

Use Form 945, Annual Return of

Withheld Federal Income Tax, to report

income tax withheld under section 3405

from pensions, annuities, and certain

other deferred income paid to a

nonresident alien individual. However, if

the recipient has elected under section

3405(a)(2) or (b)(2) not to have

withholding under section 3405, these

payments are subject to withholding

under section 1441 and the tax withheld

must be reported using Forms 1042 and

1042-S. 

Use Schedule H (Form 1040),

Household Employment Taxes, to report

any income tax, social security tax, and

Medicare tax withheld on wages paid to

a nonresident alien household employee.

For more information, see the

instructions for these forms.

You must file Form 1042 if:

● You are required to file Form(s) 1042-S

(whether or not any tax was withheld or

was required to be withheld). File Form

1042 even if you file Forms 1042-S only

on magnetic media or electronically.

● You pay gross investment income to

foreign private foundations that are

subject to tax under section 4948(a).

The amount of tax you are required to

withhold determines the frequency of

your deposits. The following rules

explain how often deposits must be

made.

1. If at the end of any

quarter-monthly period the total

amount of undeposited taxes is $2,000

or more, you must deposit the taxes

within 3 banking days after the end of

the quarter-monthly period. (A quartermonthly period ends on the 7th, 15th,

22nd, and last day of the month.) To

determine banking days, do not count

Saturdays, Sundays, legal holidays, or

any local holidays observed by

authorized financial institutions.

Form 2758 does not extend the time

for payment of tax.

The deposit rules are considered met

if:

● You deposit at least 90% of the actual

tax liability for the deposit period and

● If the quarter-monthly period is in a

month other than December, you deposit

any underpayment with your first deposit

that is required to be made after the

15th day of the following month.

Any underpayment of $200 or more for

a quarter-monthly period ending in

December must be deposited by

January 31.

2. If at the end of any month the

total amount of undeposited taxes is

at least $200 but less than $2,000, you

must deposit the taxes within 15 days

after the end of the month. If you make

a deposit of $2,000 or more during any

month except December under rule 1

above, carry over any end-of-the-month

balance of less than $2,000 to the next

month. If you make a deposit of $2,000

or more during December, any

end-of-December balance of less than

$2,000 should be paid directly to the

IRS along with your Form 1042 by

March 17, 2003.

3. If at the end of a calendar year

the total amount of undeposited taxes

is less than $200, you may either pay

the taxes with your Form 1042 or

deposit the entire amount by March 17,

2003.

Note: If you are requesting an extension

of time to file using Form 2758, follow

the rules on this page to see if you must

make a deposit of any balance due or if

you can pay it with Form 2758. See

Form 2758 and its instructions for more

information.

A Change To Note

We added an attachment requirement

for line 66. See the line 66 instructions

on page 4 for details.

Intermediary

An intermediary is a person who acts as

a custodian, broker, nominee, or

otherwise as an agent for another

person, regardless of whether that other

person is the beneficial owner of the

amount paid, a flow-through entity, or

another intermediary.

Qualified intermediary (QI). A QI is an

intermediary that is a party to a

withholding agreement with the IRS. An

entity must indicate its status as a QI on

a Form W-8IMY submitted to a

withholding agent.

Nonqualified intermediary (NQI). An

NQI is any intermediary that is not a

U.S. person and that is not a QI.
Interest and Penalties

If you file Form 1042 late, or fail to pay

or deposit the tax when due, you may

be liable for penalties and interest unless

you can show that the failure to file or

pay was due to reasonable cause and

not willful neglect.

Form 1042 (2002) Page 3

2. Late filing of Form 1042. The

penalty for not filing Form 1042 when

due (including extensions) is 5% of the

unpaid tax for each month or part of a

month the return is late, up to a

maximum of 25% of the unpaid tax.

3. Late payment of tax. The penalty

for not paying tax when due is usually 1⁄2

of 1% of the unpaid tax for each month

or part of a month the tax is unpaid. The

penalty cannot exceed 25% of the

unpaid tax.

4. Failure to deposit tax when due.

See the instructions for line 70 on

page 4.

Specific Instructions

Note: File only one Form 1042

consolidating all Form 1042-S recipient

information, regardless of the number of

different clients, branches, divisions, or

types of income for which you are the

withholding agent. However, if you are

acting in more than one capacity (for

example, you are acting as a QI for

certain designated accounts and as an

NQI for other accounts), file a separate

Form 1042 for each capacity in which

you are acting.

Address. Include the suite, room, or

other unit number after the street

address. If your Post Office does not

deliver mail to the street address and

you have a P.O. box, show the box

number instead of the street address.

QI and NQI checkboxes. See page 2

for definitions of intermediary, qualified

intermediary (QI), and nonqualified

intermediary (NQI). See the Form 1042-S

instructions for definitions of withholding

foreign partnership, withholding foreign

trust, U.S. branch treated as a U.S.

person, and flow-through entity.

1. Interest. Interest is charged on

taxes not paid by the due date, even if

an extension of time to file is granted.

Interest is also charged on penalties

imposed for failure to file, negligence,

fraud, and substantial understatements

of tax from the due date (including

extensions) to the date of payment.

Interest is figured at a rate determined

under section 6621.

Deposits by foreign corporations. Fill

in a preprinted Federal Tax Deposit

Coupon showing the “Amount of

Deposit” in U.S. dollars. Mail the

completed coupon with a bank draft in

U.S. dollars to:

Financial Agent

Federal Tax Deposit Processing

P.O. Box 970030

St. Louis, MO 63197 U.S.A.

You do not have to figure the

amount of any interest or

penalties you may owe.

Because figuring these

amounts can be complicated,

we will do it for you if you want. We will

send you a bill for any amount due.

If you include interest or penalties

(other than the penalty for failure to

deposit tax when due) with your

payment, identify and enter the amount

in the bottom margin of Form 1042,

page 1. Do not include interest or

penalties (other than the penalty for

failure to deposit tax when due) in the

balance due on line 68.

Lines 62a and 62b. Enter the amounts

requested with respect to all Forms

1042-S (regardless of whether the form

was filed on magnetic media, on paper,

or electronically) and with respect to all

Forms 1000, Ownership Certificate.

Line 62a. The amount on line 62a

should equal the sum of all amounts

shown on Forms 1042-S, box 2, and all

amounts shown as gross interest paid

on Forms 1000.

Line 62b. The amount on line 62b

should equal:

● The sum of all Forms 1042-S, box 7,

less

● The sum of all Forms 1042-S, box 8,

plus

● The tax assumed from Forms 1000.

If it does not, attach a statement to

Form 1042 explaining the difference.

Employer identification number (EIN).

You are generally required to enter your

EIN. However, if you are filing Form 1042

as a QI, withholding foreign partnership,

or withholding foreign trust, enter your

QI-EIN. Also, be sure to check the

“QI/Withholding foreign partnership or

trust” box. See QI and NQI checkboxes

below.

Completing Form 8109. If you do not

use EFTPS, deposit your income tax

payments using Form 8109. In most

cases, you will fill out a Form 8109

following the instructions in the coupon

book. However, if a deposit liability

arises from a distribution reportable on

Form 1042 for the prior year, darken the

4th quarter space on Form 8109. If the

distribution is reportable for the current

year, darken the 1st quarter space. In all

cases, follow the coupon book

instructions for completing the rest of

the deposit coupon. To ensure proper

crediting, write your taxpayer

identification number, the period to

which the tax deposit applies, and

“Form 1042” on the check or money

order.

Depositing on time. For deposits

made by EFTPS to be on time, you must

initiate the transaction at least one

business day before the date the deposit

is due.

5. Other penalties. Penalties may be

imposed for negligence, substantial

understatement of tax, and fraud. See

sections 6662 and 6663.

Lines 1 through 60. Do not enter any

negative amounts on these lines.

If you do not have an EIN, you should

apply for one on Form SS-4, Application

for Employer Identification Number. You

can get Form SS-4 by calling

1-800-TAX-FORM (1-800-829-3676). You

can also download it from the IRS Web

Site at www.irs.gov. If the withholding

agent has not received its EIN by the

time the return is due, write “Applied for”

in the space for the EIN.

Check the “QI/Withholding foreign

partnership or trust” box on page 1 if

you are a QI, a withholding foreign

partnership, a withholding foreign trust,

or a U.S. branch treated as a U.S.

person. Check the “NQI/Flow-through

entity” box if you are an NQI or a

flow-through entity.

If you are a QI that did not assume

primary withholding responsibility, enter

the total amount withheld by the U.S.

withholding agent(s) on line 59. Report

all other amounts (that is, amounts you

actually withheld) on the line that

corresponds with the date the liability

was incurred.

Electronic deposit requirement. You

must make electronic deposits of all

depository tax liabilities using the

Electronic Federal Tax Payment System

(EFTPS) in 2003 if:

● The total deposits of such taxes in

2001 were more than $200,000 or

● You were required to use EFTPS in

2002.

If you are required to use EFTPS and fail

to do so, you may be subject to a 10%

penalty. If you are not required to use

EFTPS, you may participate voluntarily.

To enroll in or get more information

about EFTPS, call 1-800-555-4477 or

1-800-945-8400. You can also visit the

EFTPS Web Site at www.eftps.gov.

To get a QI-EIN, submit Form SS-4

with your Application for QI Status

(completed in accordance with Section 3

of the preamble of Rev. Proc. 2000-12.

You can find Rev. Proc. 2000-12 on

page 387 of Internal Revenue Bulletin

2000-4 at www.irs.gov/pub/irs-irbs/

irb00-04.pdf.) Do not send an

application for a QI-EIN to the

Philadelphia Service Center; it will not

be processed.
Form 1042 (2002) Page 4

Line 70. The penalty for failure to

deposit tax when due is 2% for deposits

not more than 5 days late, 5% for

deposits more than 5 days late but not

more than 15 days late, and 10% for

deposits more than 15 days late. The

penalty is increased to 15% if the tax is

not deposited within 10 days after the

date of the first delinquency notice sent

to the taxpayer. Add the penalty to any

tax due and enter the total on line 68. If

you are due a refund, subtract the

penalty from the overpayment you show

on line 69.

Lines 69 and 71. You may claim an

overpayment shown on line 69 as a

refund or a credit. Check the applicable

box on line 71 to show which you are

claiming. If you claim a credit, it can

reduce your required deposits of

withheld tax for 2003.

Caution: Be sure to reconcile amounts

on Form 1042 with amounts on Forms

1042-S (including Forms 1042-S filed on

magnetic media and electronically), to

avoid unnecessary correspondence with

the IRS.

Amended Return

If you have to make changes to your

Form 1042 after you submit it, file an

amended Form 1042. Use a Form 1042

for the year you are amending. Check

the “Amended Return” box at the top of

the form. You must complete the entire

form, including all filing information for

the calendar year, and sign the return.

Attach a statement explaining why you

are filing an amended return (for

example, you are filing because the tax

liability for May was incorrectly reported

due to a mathematical error).

If you are also amending Form(s)

1042-S, see Correcting Paper Forms

1042-S in the Form 1042-S instructions.

Do not amend Form 1042 to recover

taxes overwithheld in the prior year. For

more information, see Adjustment for

Overwithholding in Pub. 515.

Privacy Act and Paperwork Reduction

Act Notice. We ask for the information

on this form to carry out the Internal

Revenue laws of the United States.

Sections 1441, 1442, and 1446 require

withholding agents to report and pay

over to the IRS taxes withheld from

certain U.S. source income of foreign

persons. Form 1042 is used to report

the amount of withholding that must be

paid over. Form 1042-S is used to report

the amount of income and withholding

to the payee. Section 6109 requires you

to provide your employer identification

number. Routine uses of this information

include giving it to the Department of

Justice for civil and criminal litigation,

and cities, states, and the District of

Columbia for use in administering their

tax laws. We may give the information to

foreign countries pursuant to tax

treaties. We may also disclose this

information to Federal and state

agencies to enforce Federal nontax

criminal laws and combat terrorism. If

you fail to provide this information in a

timely manner, you may be liable for

penalties and interest.

The time needed to complete and file

these forms will vary depending on

individual circumstances. The estimated

average time is: Recordkeeping, 8 hr.,

57 min.; Learning about the law or the

form, 2 hr., 31 min.; Preparing the

form, 4 hr., 26 min.; and Copying,

assembling, and sending the form to

the IRS, 32 min.

If you have comments concerning the

accuracy of these time estimates or

suggestions for making this form

simpler, we would be happy to hear from

you. You can write to the Tax Forms

Committee, Western Area Distribution

Center, Rancho Cordova, CA

95743-0001. Do not send the form to

this address. Instead, see Where and

When To File on page 2.

You are not required to provide the

information requested on a form that is

subject to the Paperwork Reduction Act

unless the form displays a valid OMB

control number. Books or records

relating to a form or its instructions must

be retained as long as their contents

may become material in the

administration of any Internal Revenue

law. Generally, tax returns and return

information are confidential, as required

by section 6103.

Line 66. You are permitted to take a

credit for amounts withheld by other

withholding agents that pertain to the

total net tax liability reported on line 63c.

For example, you are a QI and the

amount you entered on line 63c includes

amounts withheld by a U.S. withholding

agent. You may take a credit on line 66

for the amounts that were withheld by

the U.S. withholding agent.

Because this penalty

calculation is complicated, if

you want to, you can leave

line 70 blank and the IRS will

figure the penalty and send

you a bill. We will not charge you

interest on the penalty if you pay by the

date specified on the bill.

Line 63b. If you are a regulated

investment company (RIC) or a real

estate investment trust (REIT) that has

paid a dividend in January subject to

section 852(b)(7) or section 857(b)(9)

(relating to certain dividends declared in

the preceding October, November, or

December), enter your additional tax

liability on those dividends declared in

2002 but paid in January 2003 less any

additional tax liability on those dividends

declared in 2001 but paid in January

2002. Show any negative amount in

brackets. Attach a statement showing

your calculation.

Line 63a. The amount on line 63a must

equal the sum of the monthly totals as

listed on the Record of Federal Tax

Liability. Do not make any adjustments

on this line. Except for adjustments

described in the instructions for line 63b,

you may only make adjustments on the

appropriate entry line in the Tax Liability

column of the Record of Federal Tax

Liability.

Important: If you are a QI requesting a

refund, you must attach the

corresponding Form(s) 1042-S received

to support the amount claimed on line

66. Failure to do so will result in the

denial of the refund or credit being

claimed.