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Continued Efforts Are Needed to Address Billions of Dollars in Reporting and Payment Discrepancies Relating to Tax Withheld From Foreign Persons

Report Information

Date Issued
June 17, 2020
Report Number
2020-40-021
Report Type
Audit
Joint Report
Yes
Participating OIG
Treasury Inspector General for Tax Administration
Agency Wide
Yes (agency-wide)
Questioned Costs
$0
Funds for Better Use
$0

Recommendations

The Commissioner, Large Business and International Division, should review the 1,919 withholding agents TIGTA identified that did not file a Form 1042 or a Form 1042-S as required or that have a reporting discrepancy that was not identified by the Campaign 817 criteria and take appropriate action to address the withholding agents' noncompliance with the reporting requirements.

The Commissioner, Large Business and International Division, should modify the Campaign 817 filter criteria to ensure that consistent information is used on Forms 1042 and Forms 1042-S to identify withholding agents that have a reporting discrepancy.

The Commissioner, Large Business and International Division, should Modify Error Resolution function procedures to require tax examiners to ensure that the credit amount claimed on Form 1042 for tax withheld **********2********** matches the amount of tax withheld that is reported on Forms 1042-S **********2********** ***2***..

The Commissioner, Large Business and International Division, should review the 1,569 withholding agents the IRS identified that did not file Form 1042-S and take the actions necessary to address their noncompliance with the reporting requirement, including assessing failure to file penalties when appropriate.

The Commissioner, Large Business and International Division, should establish processes to identify and address withholding agents that do not complying with Form 1042-S e-filing requirements.