Internal Revenue Service United States Department of the Treasury
Level Basic Advanced Military International

Nonresident Income and Deductions

Taxation of Nonresidents

Preparing Form 1040-NR (continued)

Case Study

Paul, a student from France, received Form 1042-S showing code 20 income of $5,000. Paul also received a W-2 with $3,900 in Box 1. Paul would report $3,900 on the wage line, calculated as follows:

Amount in Box 1 of Form W-2

$3,900

Plus: Code 20 Income

$5,000

Minus: Treaty Benefit

$5,000

Equals: Amount to be listed on return

$3,900

Paul