Non-US Persons and Entities: What is meant by US source income?

In general, US source income refers to dividend and interest income earned on securities issued by US companies or US registered mutual funds as well as interest earned on US Treasury obligations and US Government agency securities. Non-US persons who receive US source income are subject to US tax withholding.  IB is required to report US source income on Form 1042-S (See the next FAQ).  Refer to IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities and Publication 519, US Tax Guide for Aliens for more information.

Circular 230 Notice: These statements are provided for information purposes only, are not intended to constitute tax advice which may be relied upon to avoid penalties under any federal, state, local or other tax statutes or regulations, and do not resolve any tax issues in your favor.

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