A 1042 form is filed to the IRS to report the tax withheld on certain US-based incomes of foreign nationals.  A 1042-S form is also issued by and submitted to the IRS. If you pay a US source of income to foreign payees, you must submit a completed 1042 and 1042-S form for every overseas payee you have paid. Each 1042-S form details the amount of US income you have paid to a particular foreign national. Typical payments reported on a 1042-S include royalties, dividends, real estate income, pension income, scholarships, gambling winnings, interest, grants, prize money, and insurance premiums.