FAQs: For Foreign Nationals
What is an alien?
An alien is an individual who
is not a citizen of the U.S.
What is the difference
between a resident alien and a non-resident alien?
A resident alien will have to pass one of the two tests
which allow for resident status, namely:
i)
The Green Card Test
ii)
The Substantial Presence Test.
(This requires residence in the U.S. for 183 days or
more in any one year.)
If the requirements of one or
other of these tests cannot be met, then an alien is
regarded as a non-resident.
How are resident and
non-resident aliens treated for tax purposes?
Resident aliens are treated
in exactly the same was as any other U.S. citizen,
i.e. they are subject to U.S. tax on their worldwide
income. Non-resident aliens are only subject to tax on
income earned in the U.S.
What is a dual-status
taxpayer?
A dual-status taxpayer is an alien who has had both
resident and non-resident status in the same tax year.
Do spouses and children of
non-resident aliens need social security numbers?
It is a requirement for a social security number (SSN)
to be shown on tax returns, statements, and other
tax-related documents. If the spouse and children of a
non- resident alien are not eligible for SSN's, they
need to apply for Individual Taxpayer Identification
Numbers (ITIN's).
In the case of joint tax
returns with a spouse or claims for exemptions for a
spouse or dependent children, the spouse and dependent
children must have either SSNs or ITINs.
Can non-resident aliens
claim the standard deduction?
No. However, there are
special exceptions for students and business apprentices
from India.
Can dual-status taxpayers claim the standard
deduction?
No, they cannot claim the standard deduction allowed on
Form 1040. However, they can itemize any allowable
deductions.
What exemptions can aliens claim?
Resident aliens can claim both personal exemptions and
exemptions for dependents. Non-resident aliens can only
claim a personal exemption for themselves. However,
there are special rules for residents of Mexico, Canada,
Japan, South Korea, and students and business
apprentices from India.
What exemptions can dual-status taxpayers claim?
It is usually possible to claim the taxpayer’s own
personal exemption. Also, subject to the qualification
rules, they can claim exemptions for spouses and
dependents for the part of the year that they are a
resident alien.
Can a non-resident alien file a joint return with a
spouse?
It is not possible to file a return as a married couple
if either spouse was a non- resident alien at any time
during the tax year. However, non-resident aliens who
are married to U.S. citizens, or residents, can elect to
be treated as U.S. residents and, therefore, file joint
tax returns.
What forms have to be filed by aliens who are leaving
the U.S.?
A Certificate of Compliance,
also known as a “departure permit” or “sailing permit,”
must be filed as part of the income tax form prior to
departure.
Is it necessary to file a
tax return as well as Form 1040-C when leaving the U.S.?
Yes, if an income tax return is
required by law, it must also be filed.
Is more information available?
Yes,
click here for further information on tax issues
relating to aliens.
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Foreign nationals have special
accounting needs.
If you live in central Texas and are applying for
citizenship, get a good Austin accountant to help you
learn our system.