As 2026 approaches, the IRS’s expanded e-filing mandate for Form 1042-S is set to impact a broader range of organizations—and GTM is here to help you stay ahead of the curve.
Under final regulations issued in 2023, any non-financial payor filing 10 or more Forms 1042-S must now submit them electronically. This is a major shift from the previous 250-form threshold and means many organizations will be navigating e-filing requirements for the first time.
Don’t wait until March 17, 2026 to get started. GTM’s Tax Automation Services team offers the expertise, tools, and support to ensure your filings are accurate, timely, and compliant.
Why This Matters
Form 1042, 1042-S, and 1042-T (if applicable) are filed by U.S. taxpayers to report U.S. sourced fixed or determinable, annual or periodic (“FDAP”) income paid to non-U.S. recipients, which may be subject to 30% withholding, unless reduced by a tax treaty.
Common reportable payments include:
- Interest
- Dividends
- Royalties
- Rents
- Prizes and awards
- Scholarships and grants
- Compensation for services performed in the U.S.
Failure to file accurately and on time can result in penalties, IRS scrutiny, and reputational risk. GTM’s Tax Automation Services team is ready to help you navigate this complex landscape with confidence.
What You Need to Know
- Deadline: March 17, 2026 (for 2025 calendar year transactions)
- Threshold: 10 or more Forms 1042-S must be filed electronically
- Systems: Acceptable e-filing platforms include:
- IRS’ Filing Information Returns Electronically (FIRE) system
- Modernized e-File (MeF) via ONESOURCE or other providers
How To Stay Compliant—and Confident
- Identify whether the payment is U.S. or foreign source for calendar year 2025.
- Retain documentation (e.g., Form W-8) from non-U.S. recipients.
- Determine if the payment is withholdable and reportable.
- Apply treaty benefits or statutory exceptions where applicable.
- Deposit withholding tax with the IRS as required.
- Prepare and file Forms 1042, 1042-S, and 1042-T (if paper mailing) by the deadline.
Why GTM?
We combine deep tax expertise with cutting-edge automation tools to deliver compliance, efficiency, and peace of mind. Whether you’re filing 10 forms or 10,000, GTM is your partner in getting it right the first time.
Let’s make this tax season your smoothest yet.
