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Non-Resident Tax Return

If you are not a US citizen or GC holder, live outside the US but earned money in the United States, you are likely required to file the annual tax form 1040NR (U.S. Nonresident Alien Income Tax Return). You may also be required to file a state tax return for your U.S. source income. IRS Publication 519 explains the complex rules governing nonresident taxation. But because few people enjoy reading IRS publications, we wrote this simple guide below.

IF YOU YOU’LL NEED TO
Have income from the US
  • US rental income, part year employment, investment income)

But do not meet the substantial presence test which would require a U.S. resident tax return.

  • File Form 1040NR
Are a Non-Resident Alien engaged in a trade or business in the United States during the calendar year
  • Even if this generated no income, or if the income is exempt from US tax under a tax treaty or any section of the Internal Revenue Code.
  • File Form 1040NR

If you earned income in the US, are a non-resident alien, and fail to file form 1040NR, you may be leaving money on the table. Many non-residents fail to file because they assume they do not owe tax due. This is backward thinking. You may actually be due a refund from the IRS due to overpayment (as taxes were already automatically withheld). The amount withheld from the average non-resident's paycheck is normally over the amount that would be due at the end of the year. Failing to file means the loss of a refund.

Aside from the financial incentive, NRA’s have an immigration incentive to file form 1040NR. Visa terms require their holders to fully comply with U.S. laws. This includes the obligation of filing a tax return. If you leave the US and seek re-entry, you may very well be required to show proof that you filed a US return. Not filing a return could put their U.S. residency status at risk.

Your tax obligations will be different depending on your status, whether you are a Resident Alien, Non-resident Alien or Dual Status Alien. Your tax obligations will even depend on the country you moved in or out of, and even on your occupation. It really is a rather complicated process - but that is what we are here for. By asking the right questions, we determine your status and file the right tax return for you.

NOTE: If you were a Non-resident alien student, teacher, or trainee who was temporarily present in the United States on an "F,""J,""M," or "Q" visa, you are considered engaged in a trade or business in the United States. You must file Form 1040NR (or Form 1040NR-EZ) only if you have income that is subject to tax, such as wages, tips, scholarship and fellowship grants, dividends, etc.

Frequently Asked Questions

1. I’m a non-US citizen and not a GC holder. I do not live in the US, but I have rental properties in the US. Do I need to file a US tax return? What about State taxes?

2. I have an H-1b visa - what is my residency status for tax purposes?

3. I have interest in the U.S. partnership but I have not spent any time in the U.S. during the tax year. Do I have any filing obligations?