My U.S. company pays royalties to a foreign entity. Do we need to file Form 1042?
My U.S. corporation licenses software from a company based in Ireland and pays them about $200,000 per year in royalties. We've been withholding 30% on these payments and depositing the tax with the IRS. Now I need to file the annual return. Is Form 1042 the right form? Do we also need to send something to the Irish company so they can claim a credit? This is all new territory for us.
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