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If you file Form 1040-NR, use Schedule NEC (Form 1040-NR) to figure your tax on income that is not effectively connected with a U.S. trade or business and to figure your capital gains and losses from sales or exchanges of property that is not effectively connected with a U.S. business.
Income which is NEC may include, but is not limited to, interest and dividends from businesses in which you are not engaged, income from real property, and gambling winnings. These amounts are reported on Schedule NEC (Form 1040). Items reported on Schedule NEC should not be reported anywhere else on your return.
Individual taxpayers who receive Form 1042-S are typically filing Form 1040-NR, U.S. Nonresident Alien Income Tax Return. You will need to make two entries in the return: Enter the 1042-S in its menu. The tax withholdings from this entry will flow to the tax return.
Go to the last option, Other reportable income and click Start. When it asks, Any other reportable income? say yes and then type in a description and the amount to report it on your tax return. For the income description, record it as 1042 S fellowship income and then the amount.
IRS Form 1042-S is a required document for reporting money paid to foreign persons (or those presumed to be foreign) by a U.S.-based business or institution.
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To get Form 1042-S withholding to flow to the 1040-NR Page 2, enter in the following places: US Tax Withheld at Source: Select interview form NR-2 - Form 1040NR Page 4 Information. Input Tax on Income not Effectively Connected with a US Trade or Business information - box 35 - 150.
Will resident aliens for tax purposes receive a 1042-S tax form? You may receive a 1042-S tax form if you claimed tax treaty benefits as a resident alien for tax purposes or your tax status changed during the previous calendar year.
Taxpayers can be penalized with financial consequences for late filing of Form 1040NR and failing to file the nonresident tax form. While nonresidents who arent U.S. citizens typically complete this form, there are times when U.S. citizens and permanent residents may need to file Form 1040NR.

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