First Year in the U.S.


When a person first moves to the U.S., the first tax return they are required to file can often be the most complex.

First Year in the U.S.

Dual Status or Full Year Election?

A taxpayer’s first year in the U.S. may present them several different options when filing their U.S. tax returns.  If the Non-U.S. taxpayer does not meet the substantial presence test, and is not a green card holder, they may be eligible to file a dual status return.  This can be a confusing form to file, although it does offer the potential benefit of not reporting any worldwide income to the IRS prior to the date they are considered to be a U.S. person for tax purposes.

Going this route can complicate the tax filings, and sometimes it is in the benefit of the taxpayer to elect to be treated as a U.S. person for tax purposes for the entire tax year.  This is done by making either the First Year Choice (allows an alien to pass the substantial presence test one year earlier), or elect with their resident alien or U.S. citizen spouse to be treated as a resident.  This can simplify the filing process and potentially save on tax fees.  However, worldwide income for the full year must be reported on the appropriate tax forms.

Don’t Forget to File in Your Country of Origin

Even though a taxpayer may have moved to the U.S., they most likely are required to at least file a tax return for their final year in their origin country.  Be sure to check with your local tax authorities regarding this issue.

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Any tax advice herein is based on the facts provided to us and on our interpretation of tax legislation as it reads at the time the advice is provided. Tax law is subject to continual change, at times on a retroactive basis and may result in incremental taxes, interest or penalties. We are not responsible for updating our advice for changes in law or interpretation after the date the advice is provided. Every tax situation is different. We are not responsible for the tax implications to any individual or entity that may act on this advice.