Explanation of Tables

The paragraphs below describe the tables that follow and provide additional information that may make the tables more useful to you.

In the tables, you will see the term New Treaty; the effective date of a new treaty is shown under Important Changes at the beginning of this publication.

Table 1

This table lists the income tax rates on such income as interest, dividends, capital gains, rents, and royalties. The income code numbers shown in this table are the same as the income codes on Form 1042-S, Foreign Person's U.S. Source Income Subject to Withholding.

Interest. If you are a nonresident alien who receives interest that is not effectively connected with the conduct of a U.S. trade or business, you do not include the interest in income if it is paid on deposits with banks, on accounts or deposits with certain financial institutions, or on certain amounts held by insurance companies. These amounts are exempt from U.S. tax even though they are considered to be income from a U.S. source. Also exempt from U.S. tax (although considered from U.S. sources) is certain portfolio interest on obligations issued after July 18, 1984. See Publication 519 for more information.

Table 2

This table lists the different kinds of personal service income that may be fully or partly exempt from U.S. income tax. You must meet all of the treaty requirements before the item of income can be exempt from U.S. income tax. The income code numbers shown in this table are the same as the income codes on Form 1042-S, Foreign Person's U.S. Source Income Subject to Withholding.

Independent personal services. The term "independent personal services" generally means services you perform for your own account if you receive the income and bear the losses arising from those services. Examples of these services are those provided by physicians, lawyers, engineers, dentists, and accountants who perform personal services as sole proprietors or partners.

Dependent personal services. Dependent personal services usually are those you perform for someone else as an employee.

Table 3

This table lists the countries that have tax treaties with the United States. Some treaties are published in the Internal Revenue Bulletins (I.R.B.) and the Cumulative Bulletins (C.B.), which contain official matters of the Internal Revenue Service. The column headed Citation shows the number of the I.R.B. or C.B. and the page on which a particular treaty may be found.

Regulations implementing some treaties were issued as Treasury Decisions (T.D.). Other treaties are explained by Treasury explanation. The fifth column lists the T.D. numbers and the I.R.B. or C.B. in which each T.D. or Treasury explanation is printed.

You can subscribe to the I.R.B. or buy volumes of the C.B. from the Government Printing Office or you are welcome to read them in most Internal Revenue Service offices. Many public libraries and business organizations subscribe to a commercial tax service that publishes the treaties and regulations or explanations.

Table 1. Tax Rates on Income Oter Than Personal Service Income Under Chapter 3, Internal Revenue Code, and Income Tax Treaties

Table 1. (Continued)

Table 1 Footnotes

Table 2. Compensation for Personal Service Performen in United States Exempt from U.S. Income Tax Under Income Tas Treaties

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Table 2 Footnotes

Table 3. List of Tax Treaties

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