WHEN IS A US NONRESIDENT ALIEN REQUIRED TO FILE A US INCOME TAX RETURN?

(Email us with your questions or for assitance at ddnelson@gmail.com)

If you are an alien (not a U.S. citizen), you are considered a nonresident alien unless you meet one of two tests. You are a resident alien of the United States for tax purposes if you meet either the green card test or the substantial presence test for the calendar year (January 1-December 31).

Certain rules exist for determining the Residency Starting and Ending Dates for aliens.

In some cases aliens are allowed to make elections which override the green card test and the substantial presence test, as follows:

• Nonresident Spouse Treated as a Resident
• Closer Connection To a Foreign Country
• Tax Treaties

You can be both a nonresident alien and a resident alien during the same tax year. This usually occurs in the year you arrive or depart from the United States. If so, you may elect to be treated as a Dual Status Alien for this taxable year and a Resident Alien for the next taxable year if you meet certain tests. (Refer to section "Dual-Status Aliens" – "First Year Choice" in Publication 519, U.S. Tax Guide for Aliens.)

A resident alien who is required to establish his/her U.S. residency for the purpose of claiming a tax treaty benefit with a foreign country should refer to Certification of U.S. Residency for Tax Treaty Purposes.

We are experts at filing tax returns and tax planning for resident and nonresident aliens. Email us at ddnelson@gmail.com with your questions. We can set up a phone or skype conference to  discuss your situation and put together a US tax plan.

Chose the Right Tax Free State to Locate can Reduce your Taxes Greatly

As a US Nonresident  when you decide where to locate your US business or to live temporarily in the United States, the state you chose to locate your business or live can save you substantial amounts of income taxes. Some states charge taxes up to 13% of your taxable income.  Others have no income taxes. Remember the US state income tax is paid on top of the US Federal taxes which can run up to 33 percent of your taxable income (21 percent for corporations).

The 6 best states to locate to avoid state income taxes include:

• Nevada
• Texas
• Florida
• Washington
• South Dakota
• Wyoming

We can help you chose the best state to in which to locate your business. We can  file for your corporation or LLC in the best tax free state. We are experts in US tax filing requirements for nonresidents and businessmen from other countries who want to locate a business in the USA. Email us at ddnelson@gmail.com to set up a consultation and learn more.

We offer Certified Public Accountant and Attorney services  associated firms  which results in lower fees to you and more efficient service.  Don D. Nelson, Attorney at Law and Kyle Lodder CPA

US Nonresidents- Where to open your US business to Save Taxes

If you are a US nonresident and want to start a business in the USA or establish a subsidiary in the US to operate your business, there are two important decisions you need to make:

1. What type of US entity to use..... a corporation or a Limited Liability Company. The tax consequences of these entities vary substantially and careful consideration of those tax consequences is need to make the right decision. There may also be legal consequences which need consideration.

2. Corporations and LLCs are chartered by one of the US 50 states. Picking the state to organize your LLC or Corporation and for it to operate its business can also have significant US tax consequences. There are 7 states which currently have no corporate income tax. Some states have taxes which can run up to 12 to 13 percent. This tax is in addition to the Federal tax the corporaton will owe the IRS.   The Seven U.S. states currently don't have an income tax are :Alaska, Florida, Nevada, South Dakota, Texas,Washington and Wyoming. 

We can help you form the US entity you need to operate your business and chose the best state operate your business for tax savings. Email us at ddnelson@gmail.com  or call our US phone number at 949-480-1235. Advance planning can save you a lot of taxes.

Nonresident US source income is taxed at a flat 30% rate, unless a tax treaty specifies a lower rate. Nonresident aliens must file and pay any tax due using Form 1040NR, U.S. Nonresident Alien Income Tax Return or Form 1040NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens with No Dependents.

In many situations nonresidents may have the option to be elected as a resident and then pay taxes at the regular graduate rates for US residents which run from 10% to 39.5%. See the sliding scale tax rates HERE

Need help with your nonresident US tax forms or want to plan your US financial connections to achieve the optimal US income tax outcome.?  Email us at ddnelson@gmail.com

Manafort Failed to File the Form 114 - Foreign Bank Account Report with IRS and now faces 150 years in Prision

Forbes magazine article states this is the same way they got Al Capone....tax evasion. Make certain you report all foreign financial accounts that you own or sign on to the IRS to avoid Manafortś problem. READ MORE IN THE FORBES ARTICLE

Two Big Income Tax Breaks for Nonresidents

If you are not a US resident there are two big tax breaks you should use.  The first is the fact that when you buy and sell US stock or mutual funds  you do not have to pay any capital gains tax on your gains.  If you were a resident you would.

The Second big benefit is that interest you earn for money deposited with US banks, savings and loans, credit unions and insurance companies do not have to pay tax on that income.

One disadvantage of being a nonresident is that you must generally pay a thirty percent tax on dividend income from US stocks (unless this rate is reduced or modified by an applicable US tax treaty.

If you are a US nonresident and plan in advance you can avoid potential US tax pitfalls by working with nonresident tax experts. Email us at ddnelson@gmail.com to set up a consultation.

US Tax Rules/Laws for Nonresidents

If you are a nonresident doing business in America, buying a US business, buying US REAL estate (for personal use or investment), or making other US investments there are many complex US federal  and state tax rules you must follow. Failure to comply can result in large monetary penalties and possible criminal action.

READ MORE ABOUT THESE USA NONRESIDENT TAXRULES AND LAWS HERE.

If you are a US Nonresident and are buying a buisness, real estate or making investments in the USA or currently have US real estate, doing business in the US, or making investments we can help you avoid the expensive consequences of failing to comply with US tax law. Email us at ddnelson@gmail.com or phone US 949-480-1235.  As an attorney everything you discuss with me is totally private and confidential.