U.S. Taxation of Foreigners
Are you a Non-Resident Alien (NRA) or a Resident Alien (RA) in the U.S?
You may qualify as a “Tax Resident” for tax filing purposes only, even if you are not a Legal U.S. Resident for U.S. Immigration purposes.
U.S. Tax Residents may be required by U.S. tax law to report your worldwide income and assets. If a foreigner is operating a U.S. Trade or Business, then there may be required tax filing obligations for the foreign owner and the U.S. operated business.
Rosillo & Associates is here to help you determine your “Tax Residency”
Determining Your Tax Filing Obligations
Business Tax Filing Requirements:
A foreign investor needs to decide if their business model will require the business’s “permanent establishment” or a connection to the U.S. to be:
- Located or considered operating in the United States
- Perform its services in the U.S. continuously and frequently
- Has a U.S. office, asset, or employees
If so, you may need to file federal or state business tax returns and declarations.
U.S. Personal Tax Filing Requirements
Anyone who:
- Operates a U.S. Trade or Business may require tax obligations for foreign entrepreneurs (see below).
- Is a Nonresident Alien, staying in the U.S., legally or illegally, less than 31 days per year:
You may need to file U.S. Non-Resident Income Tax Return form 1040NR for U.S. sourced income or losses only.
Anyone who:
- Is a non-resident living in the U.S., legally or illegally, for more than 120 days per year averaged over 3 years,
“or” - lives in the U.S., legally or illegally, for more than 183 days in the U.S. in current year:
If so, you may be required to file a business, individual, federal income, state income or asset declaration tax returns.
How to Calculate U.S. Tax Residency
A foreigner to the U.S. should calculate their days stayed in the U.S. every 12 month Calendar-Year to determine their U.S. tax residency status (more than 31 days per year?). Consider speaking to a U.S. immigration attorney about the immigration requirements needed to sty in the U.S. and “may” be needed to operate a U.S. business needed for travel or reside in the U.S.
U.S. Citizens and U.S. Legal Residents
U.S. citizens and U.S. legal residents are also considered U.S. Tax Residents. All U.S. Tax Residents may be required to file a U.S. Income Tax Return for “All Worldwide Sources of Income” and may be able to apply for foreign earned income exclusions and foreign tax credits.
International & Multinational Tax Preparation
Rosillo & Associates has helped many foreigners with tax compliance in the U.S. If any of the above applies to you, contact us today. We can help you determine tax residency status, which foreign assets need to be reported and best way to report them. We can assist you to start up your new U.S. business, prepare the accounting/bookkeeping and help you to file for most U.S. federal and state tax deadlines that will apply to you.
Give us a Call Today, request services here. Please be prepared to provide us with the number of days you have stayed in the U.S. each year matching U.S customs passport entries (https://www.cbp.gov/travel/international-visitors/i-94-instructions), foreign tax returns filed, U.S tax returns filed in the past, list of all foreign bank accounts, U.S. and possibly foreign investments, other assets and income worldwide to best determine your tax filing requirements, planning, strategies and tax preparation costs.