What Form 1040-C (2019) Is For
IRS Form 1040-C (2019) is used by departing aliens to report taxable income before leaving the United States and to confirm income taxes paid, income tax withholding, and estimated tax payments. It ensures individuals who received taxable income meet their tax obligations under income tax laws and immigration laws before obtaining a sailing permit or departure permit. It is not an annual income tax return, so you must still file Form 1040 or file Form 1040-NR after the tax year ends.
The form helps the IRS compute tax liability through a tax computation that includes tax shown, taxable income, and any tax paid for the year. Resident aliens and nonresident aliens may need to bring documents indicating income, dependents claimed, and a taxpayer identification number or individual taxpayer identification number to an IRS office for review.
For a detailed breakdown of filing requirements, eligibility rules, and step-by-step instructions, see our comprehensive guide for Form 1040-C: U.S. Departing Alien Income Tax Return (2019).
When You’d Use Form 1040-C
Departing aliens must file Form 1040-C before their departure date when they have income tax returns filed for the past year and expect more U.S. income before leaving. Such an individual may be required to appear at a local office with an alien registration card, proper identification, canceled checks, bank records, and an employer showing wages paid to verify income taxes. The form is required when you receive taxable income from a U.S. trade or business or have income effectively connected with U.S. income tax rules.
You may be exempt if you fall under specific categories, such as diplomatic passport holders, travelers under a visa waiver, or transportation line crew members. Military trainees admitted under official travel orders and individuals performing official services for a foreign government or international organization may also qualify. The area director believes an exemption applies only if your departure would not hinder the collection of income taxes or prevent the payment of taxes owed for the tax year.
Key Rules or Details for 2019
For 2019, the IRS requires individuals filing IRS Form 1040-C (2019) to report all income received or expected through the tax year's end, including wages, fellowship grants, business expenses, and capital assets. Resident aliens report worldwide income, while nonresident aliens report only U.S. income effectively connected with a U.S. trade or business. Special tax treaty benefits may reduce U.S. income tax for eligible taxpayers.
You must bring documents indicating taxable income, tax withheld, personal property transactions, accommodations furnished incident to employment authorized, and other documents verifying income. If you cannot pay the tax shown, the IRS may require a bond guaranteeing payment or a bond agreement before issuing sailing permits. Individuals who file joint returns on Form 1040 must still complete Form 1040-C separately if both spouses are departing.
For complete details on wage reporting, withholdings, and unemployment tax filings, see our guide for Individual Schedules.
Step-by-Step (High Level)
Step 1: Determine Whether You Must File
You must file if any of the following apply:
- You received taxable income during the tax year and must report it before leaving the United States.
- You expect additional taxable income before your departure date.
- You engaged in a U.S. trade or business during the tax year.
- You do not qualify for any exemption category under immigration laws.
Step 2: Gather Required Documents
Bring the following to your IRS appointment:
- Valid passport and alien registration card
- Income tax returns filed for the past year
- Documents from your employer showing wages paid
- Documents indicating business expenses and capital assets
- Fellowship grants documentation
- Airline ticket and travel itinerary
- Proper identification
- Bank records and canceled checks
- Other documents verifying taxable income
Step 3: Complete the Form
Form 1040-C includes sections for dependents claimed, taxable income, income tax withholding, estimated tax payments, and the tax computation. Resident aliens may file joint returns if eligible. Nonresident aliens cannot file joint returns.
Step 4: Attend Your IRS Appointment
Bring all documents to the local office or IRS office. An IRS employee reviews your income taxes, past year filings, tax liability, and whether a bond agreement is needed.
Step 5: Receive Your Sailing Permit
If approved, the IRS signs your departure permit. This document, which verifies tax compliance, is required under immigration laws and homeland security regulations. Keep it with your travel records.
Common Mistakes and How to Avoid Them
Taxpayers often make errors when preparing IRS Form 1040-C (2019). These issues can delay the issuance of a sailing permit or result in unpaid tax liability.
- Missing required documents: Bring bank records, canceled checks, employer wage statements, and proof of taxes paid so the IRS can verify income and process the departure permit without delay.
- Leaving out expected income: Include income expected before the departure date so the tax computation is accurate and the departure permit is not delayed.
- Misclassifying tax status: Confirm whether resident or nonresident alien rules apply before filing, since classification affects how taxable and effectively connected income is reported.
- Assuming Form 1040-C replaces the annual return: File Form 1040 or Form 1040-NR after year-end, since Form 1040-C does not satisfy the annual filing requirement.
- Overlooking treaty benefits: Review applicable tax treaties before filing so that available exclusions or reduced tax rates are applied correctly and income tax is not overstated.
What Happens After You File
After you file Form 1040-C at an IRS office, an employee reviews your tax computation, income taxes paid, and estimated tax payments to determine whether your tax obligations are met. If everything is verified, the IRS signs the document verifying clearance and issues a departure permit. Homeland Security may require this permit at the time of travel and should be kept with your airline ticket and identification.
Once the tax year ends, you must still file your annual income tax return, including Form 1040, and report income for the entire year. Any tax paid with Form 1040-C is credited toward your final liability, and additional tax returns may be needed if you were self-employed, part of an employee's household, or representative's household, or engaged in trade or business during the preceding year.
Learn more about federal tax filing through our IRS Form Help Center or explore IRS assistance options.
FAQs
Do all departing aliens need a sailing permit?
Most departing aliens do unless they qualify under specific exemption categories such as diplomatic passport holders, foreign government employees, or transportation line crew members.
Can Form 1040-C be filed electronically?
No, you must appear in person at a local IRS office.
What if I am unable to pay the full tax amount shown?
The IRS may require a bond guaranteeing payment or a bond agreement.
Do tax treaties affect my filing?
Yes, special tax treaty benefits may reduce your taxable income or lower withholding rates.
What documents do I need?
You should bring documents indicating income, tax withheld, bank records, canceled checks, and any documents verifying taxable income.
Can I claim dependents on Form 1040-C?
Yes, dependents claimed must meet IRS requirements for the tax year.
Does Form 1040-C replace the annual tax return?
No, you must still file an income tax return for the preceding year and the current year after the tax year ends.
For more resources on filing or understanding other IRS forms, visit our Form Summaries and Guides Library.