Middlebury

 

Non-Resident Alien vs. Resident Alien for Tax Purposes

Why it Matters

If you are a foreign national, you can be either a non-resident or a resident alien for tax purposes. If you are a resident alien for tax purposes, you are treated like a U.S. citizen when it comes to tax questions (except for a few rare exceptions) and you should continue in the sections on this website geared towards U.S. citizens. If you are a non-resident alien for tax purposes different rules and regulations apply to your tax status and the way you can file your tax return.

The IRS Rule

If you are a foreign national (not a U.S. citizen), you are considered a non-resident alien unless you meet one of two tests: the green card test or the substantial presence test for any given calendar year (January 1 – December 31). If you do not meet either the Green Card Test or the Substantial Presence Test, then you are a non-resident alien.

Green Card Test: You are a Lawful Permanent Resident of the United States, at any time, if you have been given the privilege, according to the immigration laws, of residing permanently in the United States as an immigrant. You generally have this status if the U.S. Citizenship and Immigration Service (USCIS) issued you an alien registration card, Form I-551, also known as a "green card." You continue to have resident status, under this test, unless you voluntarily renounce and abandon this status in writing to the USCIS, or your immigrant status is administratively terminated by the USCIS, or your immigrant status is judicially terminated by a U.S. federal court.

Substantial Presence Test: You will also be considered a U.S. resident for tax purposes if you meet the substantial presence test for the calendar year. To meet this test, you must be physically present in the United States on at least:

  1. 31 days during the current year, and
  2. 183 days during the 3-year period that includes the current year and the 2 years immediately before that, counting:
    1. All the days you were present in the current year, and
    2. 1/3 of the days you were present in the first year before the current year, and
    3. 1/6 of the days you were present in the second year before the current year.

See this IRS Article, for a Short Overview of tax requirements for Nonresident Aliens and more IRS links on this topic.

Note: You can be both a nonresident alien and a resident alien in one tax year in which case you will be considered a 'dual-status alien' for tax purposes. This usually occurs in the year you arrive or depart from the Unites States or when you change your immigration status. If so, you have to pay special attention on how to file your tax return.