IRS Tax Tips for foreigners resident and non-resident taxes

By | December 27, 2015
If you are not a U.S. citizen, if you live in the United States or spend a significant amount of time there, you still have to pay the tax on the income of U.S.


Foreign resident or non-resident

The IRS uses two tests, the green card test and the substantial presence test, to evaluate your foreign status. If you meet the requirements of any of them, is considered you a resident alien for tax purposes, otherwise, you are treated as a nonresident alien.

Filing Taxes as a Green Card Holder

If you are an alien with a green card, i.e., when the United States citizenship and immigration service allow you to legally reside in the country, you are a resident alien. However, if you do not have a green card and spend at least 31 days in the United States during the fiscal year in progress and a total of 183 days, during the last three fiscal years (including the current fiscal year), chances are that you fulfill the requirement of physical presence and also to be treated as a resident alien.


Counting 183 days in U.S.

To count the number of days that you are present in the United States during the period of three years, you don’t have to include every day. Instead, it has only a fraction of the days in two of the three years. Suppose, for example, that you are trying to find out your status for the 2012 fiscal year, since you lived in the United States for 60 days. It has 60 days to 2012, one-third of the days in 2011 and a sixth of the days in 2010. Therefore, if you were in the U.S. during 120 days in 2011 and 180 days in 2010, includes only 40 days for 2011 and 30 days in 2010, with the total for the period of three years, being 130 days. In this scenario, it pays tax to income as a non-resident alien.


IRS Physical Presence Test for Non-Resident Aliens

In addition, are not taken into account the days that are physically present in the United States under the following circumstances:
  • Day you come to work in the United States from a residence in Canada or Mexico, if regularly coming from Canada or Mexico.
  • Days you are in the United States for less than 24 hours when you’re in transit between two places outside the United States.
  • Days you are in the United States as a member of the crew of a foreign ship.
  • Days that you can not leave the United States because of a medical condition that arose during your stay.
  • Days that you’re a ‘free individual’.

A ‘free individual’ for the purposes of this essay refers to the following people:


  • An individual temporarily present in the United States as an individual of a foreign Government under an “A” or “G” visa.
  • A teacher or learner temporarily in the United States under a visa “J” or “Q”, which substantially complies with the requirements of the visa.
  • A student temporarily in the United States under a visa “F”, “J”, “M” or “Q”, which substantially complies with the requirements of the visa.
  • A professional athlete temporarily in the United States to compete in a sports charity event


U.S. Taxes for Foreign Residents

As a legal U.S. resident, you are subject to the tax rules for U.S. citizens. This means that you have to report all the income you earn in annual tax, irrespective of the country in which you win it. To prepare your return, you can always use the 1040, or if you are eligible, 1040A or 1040EZ.

U.S. Taxes on non-residents

A non-resident must also pay income taxes to the IRS, but only on the income which is effectively connected to the United States, which generally includes the money that wins, while in the United States However, the IRS has no authority to impose taxes on income that non-residents earn in their countries of origin or in any foreign country for this case. Prepare your U.S. tax return, you must use the form 1040NR or one short as the 1040NR-EZ if you are eligible. Regardless of the form that you use, you informed only of the quantities which are considered U.S. source income. As well as resident aliens and U.S. citizens, there are deductions and credits that you can claim to reduce your taxable income.

Double condition of taxpayers

In the year of transition between being a non-resident and a resident for tax purposes, is considered generally a taxpayer in State Dual. A taxpayer in State Dual presents two tax returns for the year, a statement for the portion of the year that was considered a non-resident and the other by the portion of the year considered a resident. In some situations, the taxpayer may choose to be treated as resident throughout the year in the year of transition to avoid having to file two separate statements