No tax on portfolio interest. Generally this includes dividend and short-term cap gain distributions by mutual funds. This rate may be reduced by a tax treaty with your country of residence. This rate may be reduced by a tax treaty with your country of residence. This is a fairly rare but possible situation.
Tax treaties are very important.
In particular, they often reduce the tax rate on interest and dividend income. Since you have to indicate your country of residence for tax purposes on this form, the investment income payor will know what tax treaty, if any, applies. In the spring, the payor will send you a form 1042-S reporting your income, its type, and the tax withheld. The rules did not change tax liabilities, just made it more difficult for a person to escape paying tax. None of this discussion applies to resident aliens or to US citizens living abroad.