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Nonresident Withholding Calculator30% or Treaty Rate on FDAP Income

What does this come to under the current IRS rules?

Chapter 3 withholding on U.S. source FDAP income paid to a foreign person, and the agent's shortfall if under-withheld.

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Your figures
Example figuresIllustrative only. Type over them with your own.
Withholding required
$1,500
Chapter 3 withholding, reported on Form 1042-S
Rate applied
15.00%
Net payment to the foreign person
$8,500
Drawn to one scale
Withholding required$1,500
Net payment to the foreign person$8,500
Under-withholding the agent is liable for$1,500
All results
MeasureResult
Withholding required$1,500
Rate applied15.00%
Net payment to the foreign person$8,500
Under-withholding the agent is liable for$1,500
How this was worked out
Work shownrecomputed as you type
Rate = 30%, or the treaty rate when valid documentation ties the payment to an eligible beneficial owner
Withholding = rate x gross payment
Agent shortfall = required - withheld

Illustrative arithmetic on the figures you enter. Check the result against your firm's methodology before relying on it.

The formulas

  • Rate = 30%, or the treaty rate when valid documentation ties the payment to an eligible beneficial owner
  • Withholding = rate x gross payment
  • Agent shortfall = required - withheld

How it works

Publication 515 for 2026 states that most U.S. source income received by a foreign person is subject to tax of 30%, with a reduced rate or exemption under a treaty when the withholding agent can associate the payment with documentation from a foreign beneficial owner entitled to it. Form W-8BEN is the certificate individuals give.

A withholding agent is any person who controls, receives or pays an amount subject to Chapter 3 withholding, and is personally liable for tax that should have been withheld. Payments go on Form 1042-S and the annual return is Form 1042.

Illustrative figures only. Check the result against your firm's methodology before relying on it.

Common questions

Does this apply to wages of a nonresident?

No. Wages use graduated withholding under different rules. This tool covers FDAP income such as interest, dividends, rents and royalties.

What if the W-8 expires?

Without valid documentation the agent withholds at 30%.

Is portfolio interest taxed?

Portfolio interest that meets the Publication 515 conditions is exempt from Chapter 3 withholding. Enter 0% as the rate when the exemption is documented.

Sources

Runs in your browser. The figures you type are not sent to CORAA or stored. Check the result against your firm's methodology before relying on it.

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