TaxCrossing
taxcrossing.comMyth vs actual

“Income code 24 is director's fees.”

Actual: Code 24 is qualified investment entity (QIE) distributions of capital gains. There is no 1042-S code for director fees at all. They report under code 17, compensation for independent personal services.

A correct rate under a wrong code still draws IRS matching notices. The code is what the IRS reads.

2026 Instructions for Form 1042-S, Box 1Full analysis →