Frequently Ask Questions
Green Card Holders
- I am a green card holder. May I claim residence in a foreign country under a tax treaty and obtain benefits under the tax treaty?
- I was a long-term resident of the United States prior to surrendering my green card. What is my U.S. tax filing obligation?
- What are my responsibilities as a green card holder if I have been absent from the United States for a long period of time?
I am a green card holder. May I claim residence in a foreign country under a tax treaty and obtain benefits under the tax treaty?
As a green card holder, you are a U.S. tax resident. However, the definition of residency under U.S. tax laws does not override tax treaty definitions of residency. If you are a dual-resident taxpayer (a resident of both the United States and another country under each country’s tax laws), you can still claim the benefits under an income tax treaty.
The income tax treaty between the two countries must contain a provision that provides for resolution of conflicting claims of residence (tie-breaker rule). If you would be treated as a resident of the other country under the tie-breaker rule and you claim treaty benefits as a resident of that country, you are treated as a nonresident alien in figuring your U.S. income tax. For purposes other than figuring your tax, you will be treated as a U.S. resident. For example, the rules discussed here do not affect your residency time periods as discussed in FAQ 17 above.
If you are a dual-resident taxpayer and you claim treaty benefits as a resident of the other country, you must file a return by the due date (including extensions) using Form 1040NR or Form 1040NR-EZ, and compute your tax as a nonresident alien. You must also attach a fully completed Form 8833 if you determine your residency under a tax treaty and receive payments or income items totaling more than $100,000. You may also have to attach Form 8938.
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I was a long-term resident of the United States prior to surrendering my green card. What is my U.S. tax filing obligation?
You are a long-term resident for U.S. federal income tax purposes if you were a lawful permanent resident of the United States (green card holder) in at least 8 of the last 15 tax years ending with the year your residency ends. In determining if you meet the 8-year requirement, do not count any year that you are treated as a resident of a foreign country under a tax treaty and do not waive treaty benefits.
If you are a long-term resident who has surrendered your green card, you may be subject to the expatriation tax. In general, the expatriation tax provisions apply to U.S. citizens who have renounced their citizenship and long-term residents who have ended their residency. The rules that apply are based on the dates of expatriation.
You may also be a dual-status alien if you have been both a resident alien and a nonresident alien in the same tax year. Dual status does not refer to your citizenship, only to your resident status for tax purposes in the United States.
- For The Part of the Year that You are a Resident Alien, you are taxed on income from all sources: inside and outside of the United States.
- For The Part from the Time that You Abandon Your Green Card, you are taxed on income from U.S. source only.
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What are my responsibilities as a green card holder if I have been absent from the United States for a long period of time?
As a green card holder, you generally are required to file a U.S. income tax return and report worldwide income no matter where you live.
However, if you surrender your green card or the U.S. Citizen & Immigration Service determines that you have abandoned your green card and takes it away from you, you will need to follow the nonresident alien requirements for filing a Form 1040NR, U.S. Nonresident Alien Income Tax Return (PDF).
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