Get your free financial scoreSign inYour data on this device
Free to use. No account required.

How do tax treaties reduce withholding on my U.S. investment income as a nonresident?

U.S.-source investment income paid to a nonresident alien—dividends, certain interest, royalties—is normally subject to a flat 30% withholding tax. A tax treaty between the U.S. and your home country can lower that rate, sometimes to 15% or even zero on specific income types. To claim the reduced rate you give the payer a Form W-8BEN listing your country of residence and the treaty article. For example, treaty rates commonly cut dividend withholding well below 30%. The benefit applies to the gross payment, so claiming it correctly puts more income in your pocket up front rather than waiting for a refund. Each treaty has different rates by income category, so check your specific country's treaty table. Make sure your broker has a current W-8BEN on file, because without it they'll default to the full 30%.

All questionsBrowse the articles
Educational disclaimer. Everything on WealthSerene.com is educational and is not investment advice. Projections and calculations are illustrative; actual results depend on market conditions, your situation and factors outside this tool’s scope. For a decision specific to your situation, consult a qualified financial professional. View full disclosures