What is FDAP Income?
U.S. source Fixed, Determinable, Annual or Periodic (FDAP) income is generally subject to taxation when amounts are paid to nonresident taxpayers. This article summarizes the key components of FDAP income.
Non-US Persons Pay Tax on US Source Income
Nonresidents of the U.S. are generally not subject to any U.S. federal income taxes unless they have U.S. source income. U.S. source FDAP income paid to nonresidents is subject to withholding taxes at source.