US residency for tax purposes

A US citizen is taxed on worldwide income by virtue of citizenship alone, a US resident for tax purposes is a non-citizen who either holds a green card or meets the Substantial Presence Test, and "US person" is the broader umbrella term that covers both groups — plus certain domestic entities — for tax and reporting purposes. The key idea is that citizenship and tax residency aren't the same thing: a non-citizen can be a full US tax resident, taxed the same way as a citizen, without ever holding a US passport. TFX's guide to US tax residency breaks down how these categories relate.

US citizens and resident aliens are both taxed on worldwide income no matter where they live, while nonresident aliens are generally taxed only on their US-source income — the fundamental split in the US tax system. A resident alien is a non-citizen who qualifies for full US tax residency either by holding a green card or by meeting the Substantial Presence Test, whereas a nonresident alien has done neither and files Form 1040-NR instead of the standard 1040. TFX's resident vs. nonresident guide lays out how each status is determined.

The Substantial Presence Test determines whether a non-citizen becomes a US tax resident based on physical days in the country: you must be present at least 31 days in the current year, and the weighted total of your days across the current year (counted in full) plus the prior year (counted at one-third) plus the year before that (counted at one-sixth) must reach 183 days. Meeting this test makes you a resident alien taxed on worldwide income, just like a US citizen, even without ever holding a green card. TFX's substantial presence test guide walks through the full day-counting formula with examples.

Yes, but it takes a formal, affirmative step — a US citizen must go through the legal renunciation process (including a final tax return and Form 8854), and a green card holder must formally abandon their status rather than simply letting the card expire or moving away. Long-term residents who've held a green card for 8 or more years can face the same potential exit tax under IRC §877A that applies to renouncing citizens, and until you complete the formal process, the IRS continues to treat you as a US person regardless of how long you've been living abroad. TFX's citizenship-based taxation guide covers what's required to formally end US tax person status.

A "US person" includes US citizens (including those born abroad to a US citizen parent), dual citizens, lawful permanent residents (green card holders) who haven't formally ended that status, and anyone else who qualifies as a resident alien under the Substantial Presence Test — plus certain domestic entities like US corporations, partnerships, trusts, and estates in reporting contexts. All of these are taxed on worldwide income and subject to the same reporting obligations, which is why the definition matters well beyond individuals filing a personal return. TFX's citizenship-based taxation guide covers this full definition.

These are two unrelated tests for two entirely different purposes: the Substantial Presence Test determines whether a non-citizen becomes a taxable US resident, using a weighted day-count formula across three years, while the Physical Presence Test is one of two ways a US citizen or resident already living abroad can qualify for the Foreign Earned Income Exclusion, requiring 330 full days outside the US within any 12-month period. Confusing the two matters in practice — one test can make you a US tax resident for the first time, while the other only helps someone who's already a US person exclude foreign earned income from tax. TFX's substantial presence test guide covers the residency side of this distinction.

You generally must file if your gross income meets or exceeds the standard filing threshold for your status — for 2025, that's $15,750 for a single filer under 65 — or if you have net self-employment earnings of $400 or more, and these thresholds apply whether you live in the US or abroad. The obligation to file exists independently of whether you'll actually owe tax after claiming relief like the Foreign Earned Income Exclusion or the Foreign Tax Credit — plenty of expats who owe nothing still have to file. TFX's citizenship-based taxation guide and its guide on US taxes for citizens abroad cover the current filing thresholds in full.

On IRS and FinCEN forms — like Form W-9 or an FBAR/FATCA certification — "US person" is a specific defined checkbox that's broader than "citizen," covering green card holders and resident aliens under the Substantial Presence Test as well; someone can be legally required to check "US person" on these forms without holding US citizenship at all. This is why a green card holder or long-term US resident fills out the same W-9 a citizen would, while someone who is genuinely a nonresident alien instead completes a W-8 series form certifying they're not a US person. TFX's citizenship-based taxation guide covers how this definition is applied in practice.