2022-18638. Proposed Collection; Requesting Comments on TD 9584, TD 9734, Form 1042, Schedule Q (Form 1042), Form 1042-S, and Form 1042-T

AGENCY:

Internal Revenue Service (IRS), Treasury.

ACTION:

Notice and request for comments.

SUMMARY:

The Internal Revenue Service, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995. The IRS is soliciting comments concerning final regulations in Treasury Decision (TD) 9584 relating to interest paid to nonresident aliens, TD 9734 relating to dividend equivalents from sources within the United States, Form 1042, Schedule Q (Form 1042), Form 1042-S, and Form 1042-T.

DATES:

Written comments should be received on or before October 31, 2022 to be assured of consideration.

ADDRESSES:

Direct all written comments to Andres Garcia, Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW, Washington, DC 20224, or by email to [e-mail]. Include OMB Control No. 1545-0096 in the subject line of the message.

FOR FURTHER INFORMATION CONTACT:

Requests for additional information or copies of this collection should be directed to Jon Callahan, [phone], at Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW, Washington, DC 20224, or through the internet at [e-mail].

SUPPLEMENTARY INFORMATION:

The IRS is currently seeking comments concerning the following information collection tools, reporting, and record-keeping requirements:

Title: TD 9584, TD 9734, Form 1042, Schedule Q (Form 1042), Form 1042-S, and Form 1042-T.

OMB Number: 1545-0096.

Form Number: 1042, Schedule Q (Form 1042), 1042-S, and 1042-T.

Regulation Project Number: TD 9584 and TD 9734.

Abstract: TD 9584 contains final regulations that provide guidance on the reporting requirements for interest on deposits maintained at the U.S. office of certain financial institutions and paid to nonresident alien individuals. These regulations affect persons making payments of interest with respect to such a deposit. TD 9734 contains regulations pertain to Internal Revenue Code (IRC) section 871(m) regarding dividend equivalent payments that are treated as U.S. source income. These regulations provide guidance regarding when payments made pursuant to certain financial instruments will be treated as U.S. source income and subject to U.S. withholding tax.

Form 1042 is used by withholding agents to report tax withheld at source on certain income paid to nonresident alien individuals, foreign partnerships, and foreign corporations to the IRS. Schedule Q (Form 1042) is used withholding agents to report the tax liability of a qualified derivatives dealer (QDD). Form 1042-S is used by withholding agents to report income and tax withheld to payees. A copy of each 1042-S is filed electronically or with Form 1042 for information reporting purposes. The IRS uses this information to verify that the correct amount of tax has been withheld and paid to the United States. Form 1042-T is used by withholding agents to transmit paper Forms 1042-S to the IRS.

Current Actions: There is are changes to the existing collection: (1) Schedule Q (Form 1042) was created to replace the previous requirement to attach a statement to the Form 1042 to provide information regarding a QDD's tax liability; (2) the burden for TD 9584, previously reported under OMB control number 1545-1725, is being incorporated in this collection for clarity and continuity; (3) the burden for Form 1042 was recalculated for better estimates; and (4) the number of respondents and responses for all forms were updated with better estimates.

Type of Review: Revision of a currently approved collection.

Affected Public: Individuals, business or other for-profit organizations, estates, trusts, tax-exempt organizations, and government entities.

Estimated Number of Respondents: 138,150.

Estimated Number of Responses: 8,560,200.

Estimated Time per Respondent: 15 minutes for TD 9584, 8 hours for TD 9734, 29 hours and 28 minutes for Form 1042, 5 hours and 44 minutes for Schedule Q (Form 1042), 34 minutes for Form 1042-S, and 12 minutes for Form 1042-T.

Estimated Total Annual Burden Hours: 6,704,749.

The following paragraph applies to all of the collections of information covered by this notice:

An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.

Request for Comments: Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval. All comments will become a matter of public record. Comments are invited on: (a) Whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden of the collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology; and (e) estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information.

Approved: August 25, 2022.

Jon R. Callahan,

Tax Analyst.