What US taxes do non-residents have to pay when owning or selling US company stocks?

Thanks for the info! So if I understand correctly, I only get taxed on dividends but not when I sell for profit? My broker is non-US based, so how does the dividend withholding actually work in practice? Do they automatically take out 30% or do I need to file something?

For dividends, yes, the 30% withholding happens automatically. Your broker will withhold it before sending you the remaining 70%, even if they're not US-based. They have agreements with US clearing houses that require this withholding. For selling stocks, you're correct. Most non-residents don't pay US capital gains tax on stock sales unless they have substantial presence in the US (generally 183+ days) or the income is connected to a US business. Your local tax authorities may still want their share of your profits though!

Does this tool actually connect to IRS systems or is it just general advice? I'm skeptical because the tax implications can be so different depending on your specific country.

I've been investing in US stocks for years from overseas and found the rules pretty straightforward once I understood them. Is this service actually worth it compared to just asking my accountant? My country doesn't have a tax treaty either but my local accountant seems confident about handling it.

The tool doesn't connect directly to IRS systems - it analyzes your specific situation based on information you provide and generates tailored guidance. It takes into account your country of residence, the types of investments you have, and other factors to provide personalized advice. I found it valuable because it explained the nuances that apply to my specific situation rather than just general advice. While your accountant might be knowledgeable, I appreciated having a second opinion specifically focused on US tax law for non-residents, especially since the rules can change. My local accountant was great with my home country taxes but less confident with the US specifics.

Wait, how does this actually work? I thought the IRS phone lines were impossible to get through. Is this some kind of premium line or something?

Sounds like a scam tbh. Why would you need to pay someone to call the IRS? And even if you got through, would a random IRS phone agent even know the specific rules for international investors? Doubt it.

It's not a premium line - they use technology to continuously dial and navigate the IRS phone system for you. When they reach a real agent, they call you and connect you directly. It's basically like having someone wait on hold for you instead of doing it yourself. I was also skeptical about whether an IRS agent would know about international tax issues, but I was connected to someone in their international taxpayer department who was quite knowledgeable. They confirmed exactly how my dividend withholding should be handled and what my obligations were as a non-resident investor from a non-treaty country. The peace of mind was definitely worth it after getting the runaround from my broker.

Could you clarify about the ETFs? I'm currently investing in VOO (Vanguard S&P 500) as a non-resident. Are you saying this is treated differently than owning the individual stocks directly? What reporting would I need to do?

For non-US residents, US-domiciled ETFs like VOO are generally treated the same as individual US stocks - you'll face the 30% dividend withholding tax but typically no capital gains tax. The PFIC rules I mentioned generally apply when US persons invest in non-US funds. However, there's another consideration - some brokers won't even allow non-US residents to purchase US-domiciled ETFs due to regulations. You might want to check if your holdings comply with your broker's policies. Some non-US investors use Irish-domiciled ETFs that track US indices as an alternative since they can reduce the dividend withholding to 15% due to the US-Ireland tax treaty.

Do you just need the year-end statement from your broker or should I be saving each individual dividend payment record? My broker (Interactive Brokers) provides some tax forms but I'm not sure if they're sufficient.

Your broker's year-end tax summary should be sufficient for most purposes, but I'd recommend keeping quarterly statements as backup. Interactive Brokers is pretty good about providing detailed tax reporting - they should show you the gross dividends received and the US tax withheld. The key document you'll want is their annual tax statement which breaks down all your dividend income and withholding by country. This makes it much easier when you're filing your home country taxes and claiming foreign tax credits. I learned this lesson after spending hours trying to reconstruct my dividend history from monthly statements!