Guide to Global Payroll Management - 2020 - D-109

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Appendix D--Federal Forms and Instructions

Appendix A
Box 1 Income Codes
Code

Interest Income

16
17
18
19
20
23
24

Scholarship or fellowship grants
Compensation for independent personal services2
Compensation for dependent personal services2
Compensation for teaching2
Compensation during studying and training2
Other income
Qualified investment entity (QIE) distributions of capital gains

25
26

29
30

Interest paid by U.S. obligors - general
Interest paid on real property mortgages
Interest paid to controlling foreign corporations
Interest paid by foreign corporations
Interest on tax-free covenant bonds
Interest paid on deposit with a foreign branch of a
domestic corporation or partnership
Deposit interest
Original issue discount (OID)

31

Short-term OID

27

33
51

Substitute payment - interest
Interest paid on certain actively traded or publicly offered
securities1
Substitute payments - interest from certain actively
traded or publicly offered securities1

28

Trust distributions subject to IRC section 1445
Unsevered growing crops and timber distributions by a trust
subject to IRC section 1445
Publicly traded partnership distributions subject to IRC section
1446
Gambling winnings3

32

Notional principal contract income4

43

Substitute payment - other
Capital gains distributions
Return of capital
Eligible deferred compensation items subject to IRC section
877A(d)(1)
Distributions from a nongrantor trust subject to IRC section 877A(f)
(1)
Guarantee of indebtedness
Earnings as an artist or athlete - no central withholding
agreement5
Earnings as an artist or athlete - central withholding agreement5

44

Specified federal procurement payments

01
02
03
04
05
22

54
Code
06
07

Dividend Income
Dividends paid by U.S. corporations - general
Dividends qualifying for direct dividend rate

35
36
37
38

08

Dividends paid by foreign corporations

39

34
40

Substitute payment-dividends
Other dividend equivalents under IRC section 871(m)
(formerly 871(l))
Dividends paid on certain actively traded or publicly
offered securities1
Substitute payments-dividends from certain actively
traded or publicly offered securities 1

41
42

52
53
Code
09
10
11
12
13
14
15

Other Income

Capital gains
Industrial royalties
Motion picture or television copyright royalties
Other royalties (for example, copyright, software,
broadcasting, endorsement payments)
Royalties paid on certain publicly offered securities1
Real property income and natural resources royalties
Pensions, annuities, alimony, and/or insurance premiums

50

55

Income previously reported under escrow procedure6

Taxable death benefits on life insurance contracts

1
This code should only be used if the income paid is described in Regulations section 1.1441-6(c)(2) and withholding agent has reduced the rate of
withholding under an income tax treaty without the recipient providing a U.S. or foreign TIN.

If compensation that otherwise would be covered under Income Codes 17 through 20 is directly attributable to the recipient's occupation as an
artist or athlete, use Income Code 42 or 43 instead.
Subject to 30% withholding rate unless the recipient is from one of the treaty countries listed under Gambling winnings (Income Code 28) in Pub.
515.
4
Use appropriate Interest Income Code for interest from a notional principal contract where nonperiodic payment(s) are treated as a loan.
5
Income Code 43 should only be used if Letter 4492, Venue Notification, has been issued by the IRS (otherwise, use Income Code 42 for earnings
as an artist or athlete). If Income Code 42 or 43 is used, Recipient Code 22 (artist or athlete) should be used instead of Recipient Code 16
(individual), 15 (corporation), or 08 (partnership other than withholding foreign partnership).
6
Use only to report gross income the tax for which is being deposited in the current year because such tax was previously escrowed for chapters 3
and 4 and the withholding agent previously reported the gross income in a prior year and checked the box to report the tax as not deposited under
the escrow procedure. See the instructions for this form for further explanation.
2
3

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