I don't believe you report the interest paid to a foreigner on a 1099-INT. Rather, you should report the payment and withholding on an IRS Form 1042 series Take a look at this link below from the IRS. In addition to Form 1042. there is a 1042-S and a 1042-T. You may be required to file most of these forms electronically. See the 1042 Instructions.
About Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons | Internal ...
Use Form 1042 to report the following:
- The tax withheld under chapter 3 on certain income of foreign persons, including nonresident aliens, foreign partnerships, foreign corporations, foreign estates, and foreign trusts.
- The tax withheld under chapter 4 on withholdable payments.
- The tax withheld pursuant to section 5000C on specified federal procurement payments.
- Payments that are reported on Form 1042-S under chapters 3 or 4.
