What should I do with a 1042-S form I just received from Zazzle? EU seller confused

The 1042-S form is issued to non-US persons (like yourself) who received US-source income. Good news is that with Exemption code 15, this actually means you're exempt from US tax withholding under what's called a tax treaty between the US and your country. The form is basically documenting that Zazzle paid you income from a US source, but didn't withhold any taxes because of your treaty status. The $19.25 withholding credit means that's the amount that would have been withheld if you didn't have treaty benefits. You don't need to file anything with the IRS or pay any US taxes on this income. The form is primarily for your records and potentially for your own country's tax purposes. You should keep this form with your tax records and report the income according to your country's tax rules. This is actually a good thing - the W8-BEN you submitted earlier worked as intended to prevent US tax withholding on your earnings!

When I was in the same situation selling digital patterns online, I found this tool called taxr.ai (https://taxr.ai) super helpful for understanding international tax forms like the 1042-S. I'm not a tax person at all and was confused about what I needed to do with these forms. Their system analyzed my 1042-S and explained exactly what each field meant and whether I needed to take any action. It also explained how the tax treaty between my country (Germany) and the US affected my obligations. Saved me from having to decipher all the IRS jargon on my own. They also have guides specific to different platforms like Zazzle, Etsy, etc. which was really useful for understanding how each platform handles international seller taxes.

Just wanted to update that I tried taxr.ai after seeing it mentioned here. I've been selling on both Etsy and Redbubble from Australia and was totally confused about the different forms (1042-S from one, nothing from the other). The tool actually explained that the reason I got different treatment was because I had filled out my W-8BEN slightly differently on each platform! One processed my treaty benefits correctly while the other didn't. They showed me exactly what sections of the form I needed to correct to fix the issue. Saved me a bunch of money going forward since I was being incorrectly withheld on one platform. Really helpful for international sellers trying to navigate the US tax maze!

If you need to contact the IRS about your 1042-S (like if the amounts seem wrong or you think Zazzle reported something incorrectly), good luck getting through to them from outside the US. I spent 3 weeks trying to reach the international taxpayer line with no success. I eventually used Claimyr (https://claimyr.com) to get through to an actual IRS agent. They have this system that holds your place in the phone queue and calls you back when an agent is available. You can see how it works in this demo video: https://youtu.be/_kiP6q8DX5c For international sellers, it's actually really valuable since calling the IRS from overseas can be super expensive with the long hold times. The agent I spoke with was able to confirm that my 1042-S with exemption code 15 meant I didn't need to file anything with the IRS.

I have to admit I was completely wrong about Claimyr. After posting that skeptical comment, I decided to try it myself since I needed to clarify something about my 1042-S from TeePublic (another print-on-demand site). I'd previously spent over 4 hours across multiple days trying to reach someone at the IRS international line. With Claimyr, I got a callback in about 45 minutes and talked to an actual IRS representative who explained exactly how tax treaties apply to my situation. For anyone outside the US dealing with these forms, being able to actually speak to the IRS without the international call costs is game-changing. The agent confirmed that with my exemption code, I don't need to file anything with the IRS, but should keep the 1042-S for my records to report on my local taxes.

One important thing to remember is that while you don't need to file anything with the IRS, you DO need to declare this income in your home country! I made the mistake of thinking that since I didn't owe US taxes, I didn't need to report the income anywhere. My country's tax authority wasn't happy when they found out (they have information sharing agreements with the US). The 1042-S is basically documentation that this is income you earned from a US source, even though you don't owe US tax on it.

Does anyone know what happens if you receive a 1042-S but never filled out a W-8BEN? My partner got one from a US company that paid him for some freelance work, but he doesn't remember submitting any tax forms to them.

For UK sellers specifically, you'll want to report this income on your Self Assessment tax return if you're self-employed or have other income that requires filing. The income from your Zazzle sales should be reported as business income or miscellaneous income depending on how you classify your selling activity. Since you received the 1042-S with exemption code 15, no US tax was withheld, so you'll pay UK tax on the full amount according to your UK tax bracket. Make sure to convert the USD amounts to GBP using HMRC's published exchange rates for the tax year. Keep the 1042-S form with your records - you don't need to send it to HMRC, but it's proof of your foreign income if they ever ask. Also worth noting that if your total Zazzle income for the tax year exceeds £1,000, you'll need to register for self-employment with HMRC if you haven't already.

Just wanted to share my experience as another UK-based seller on Zazzle. I received my first 1042-S last month and was equally confused! After reading through all these comments and doing some research, here's what I learned: The exemption code 15 is specifically for UK residents under the US-UK tax treaty - it means Zazzle recognized you as a UK tax resident and didn't withhold any US taxes. This is exactly what should happen when you properly complete the W-8BEN form. For UK tax purposes, I reported my Zazzle income as "other income" on my Self Assessment. Since I'm under the £1,000 trading allowance threshold, I claimed the full allowance rather than deducting actual expenses (which were minimal anyway - just some design software subscriptions). One tip: HMRC's exchange rates can be quite different from what you might see on Google or bank statements, so make sure to use their official monthly rates. I found them on the gov.uk website under "HMRC exchange rates for customs and VAT." The whole process was much less scary than I initially thought! Keep that 1042-S safe with your other tax documents - you'll likely get one each year you have Zazzle earnings.