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Old 11-23-2014, 05:04 AM
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Question Dual Status Alien: How Report NR Tax

Hi Everyone,

I was a nonresident in 2014 from Jan 1 to Nov 11. On Nov 12 I am happy and grateful to say I became a US permanent resident (Green Card status).

100% of my income is from a US business (my employer). I am paid monthly on the last business day of each month.

I know from IRS Pub 519 that for this year, I will have to file as a Dual Status Alien (all previous 1040 filings were as a nonresident). I know that I will have to file the Form 1040, but then include a "Dual Status Statement" - such as a Form 1040 NR - to indicate my nonresident period income.

My question: How do I calculate my nonresident income?

In 2014, I was a nonresident for 315 days and will be a resident for 50 days of the year. Can I then state in the 1040 NR statement that my nonresident
income for 2014 was:

315 days / 365 days * Total income on W-2 ?

I.e. do I just report the prorated amount of my income (~86.3%) as nonresident income, based upon the calendar calculation?

I am not sure how else to handle this, since I'm guessing I will not get separate W-2s for my nonresident period and my resident alien period.

Please let me know any helpful info, feedback or guidance. Thank you in advance for your assistance!!


Cheers,
lonewolfito



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Old 11-23-2014, 06:27 PM
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I was a nonresident in 2014 from Jan 1 to Nov 11. On Nov 12 I am happy and grateful to say I became a US permanent resident (Green Card status).=======>>>>>>>>so yu became a US resident for ONLY tax purposes.as you know, in US, dual status does not refer to your citizenship, only to your resident status for tax purposes. For the part of the year you become a U.S. resident a, you need o pay taxes on income from all sources, US source and world wide income if you have( if you receive it while you are a US resident ).However, for the part of the year you are a non US resident, you need to pay taxes ONLY on income from U.S. sources. Any income from sources outside the US not effectively connected with a trade /biz in the US is not taxable aslongas you receive it while you are a non US resident.So, any U.S. source income is taxable on your returns whether you receive it while a nonresident alien or a US resident unless specifically exempt by the IRS/your state DOR.

100% of my income is from a US business (my employer). I am paid monthly on the last business day of each month.I know from IRS Pub 519 that for this year, I will have to file as a Dual Status Alien (all previous 1040 filings were as a nonresident). I know that I will have to file the Form 1040, but then include a "Dual Status Statement" - such as a Form 1040 NR - to indicate my nonresident period income.===>>>>>>Correct as the IRS Pub #519 states.

My question: How do I calculate my nonresident income? In 2014, I was a nonresident for 315 days and will be a resident for 50 days of the year. Can I then state in the 1040 NR statement that my nonresident income for 2014 was:315 days / 365 days * Total income on W-2 ? I.e. do I just report the prorated amount of my income (~86.3%) as nonresident income, based upon the calendar calculation?===========>>>>>>>I guess so;in general, you must file your tax return on the basis of an annual accounting period called a tax year; your tax year is usually the calendar year, jan 1 thru dec 31.As said, for the part of the year you are a resident alien, 50 /365, you are taxed on income from both world wide and US sources as a US resident alien. The world wide income( if you had) is taxable even if you earned it while you were a nonresident alien receiving it and before the end of the year. For the part of the year you are a nonresident alien,315/365, you need to pay taxes on income from U.S. sources and on certain foreign source income treated as effectively connected with a U.S. trade or business(if you had). Income from sources outside the US not effectively connected with a trade or business in the US is not taxable if you receive it while you are a nonresident alien. The income not effectively connected with a trade or business in the US is not taxable even if you earned it while you were a resident alien or if you became a resident alien or a U.S. citizen after receiving it and before the end of the year.

I am not sure how else to handle this, since I'm guessing I will not get separate W-2s for my nonresident period and my resident alien period.======>>>>>>>For more info in detail, you need to contact an IRSEA or a CPA specializing taxation in your local area.



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Old 11-23-2014, 10:28 PM
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Join Date: Nov 2014
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Dual Status Alien Question

Thank you for your informative response! That helps clarify things.

Cheers



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