The Internal Revenue Service dictates that all casinos withhold 30% of the winnings for the foreign gamblers. The 30% is supposed to be part of the gambling tax that the country has decreed to everyone including foreigners. But with the Canadian-U.S. Tax Treaty, there is a program of IRS tax recovery for Canadians.
Following the treaty, the IRS will withhold 30% of the winnings of all foreigner winners even Canadians. However, the Canadians can ask for a refund of the portion of their winnings is proclaimed by the treaty. Aside from them, some resident of other countries can also request for this refund like the resident of United Kingdom, Italy and France. All these countries can request for their refund and the process is not very difficult.
IRS tax recovery for Canadians require some things to be passed and be submitted. A proof that the winner indeed is a Canadian is a must. Documents which prove his nationality should be submitted to the Internal Revenue Service for further inspection. There identification documents can also be varied depending on what you are and what you have. All these documents are very necessary to get submitted and in this it will be proved that you are a Canadian. There is a treaty that the Canadian can ask for the refund of their winning that they have made the request for.
The 1042-S form is very important in IRS tax recovery for Canadians. This form will be the proof of winning, their receipt. This will also prove that 30% of their winnings were indeed withheld by the casino where the winner played. It is very important for a Canadian to know about this form and fill it with appropriate documents that says you are a Canadian. Without this form, it would be impossible to request for a refund. However, losing this form does not mean the end of the world. You may ask for another one in the specific casino. But it would be easier to leave the job of IRS tax recovery for Canadians to the professionals.