Non-Resident x Resident Alien

How do you know how to report your income tax in the U.S. if you are a foreign national?

If you are currently living in the United States for work or study, you might qualify to file your tax return as US Resident for tax purposes.

To qualify to file your taxes as a U.S. resident you need to meet either the green card test or the substantial presence test for the calendar year. If you qualify to file your taxes as a US Resident, you will be allowed the same deductions that U.S. citizens have but you will also have the same obligations. That means you will have to report your worldwide income, make estimate payments, and follow the same deadlines as a U.S. citizen.

There are also other obligations that a U.S. resident has when reporting income, such us Fbar (Report of Foreign Bank and Financial Accounts) and FATCA to report financial assets outside the United States. If you are here as a Student and qualify as a resident based on the presence test you can still choose to file as a Non-Resident for up to 5 years and request an exemption on reporting worldwide income, this way your only obligation is to report income received in the U.S. territory.

However, if you recently became a permanent resident (Green Card holder) you will have to report as a Resident and include your worldwide income.

Anyways, if you are a new resident of the United States to figure out the best choice for you when reporting your taxes is to contact a tax professional that can explain to you the options and what is the best choice for you.