Withholding is generally required on any item of U.S. Source FDAP income.
In general, foreign persons (individuals and entities) are subject to U.S. income tax at a 30% rate on FDAP income they receive from U.S. sources. Taxation is achieved by means of the withholding required to be made by the payor of the U.S. source FDAP income to foreign beneficial owners. This video provides an overview of FDAP income sources and the relevant withholding forms for Section 1441/1442 withholding.
Runtime: 25 minutes
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