Nonresident Tax

What non resident aliens are required to file?

According to the IRS, non resident aliens are individuals who are not U.S. citizens or nationals who have not passed their green card test or the substantial presence test. Non residents may still have a tax obligation to the United States, even if they did not reside here in the U.S. Below is a brief list of circumstances when non resident alien tax filing is required:

  • Non resident aliens who have engaged in a trade or business within the U.S.
  • Non resident aliens not engaged in U.S. trade or business with U.S. sourced income that has not been taxed appropriately at the source or an income tax treaty is required to be disclosed
  • Representatives responsible for filing the tax return for a non resident alien
  • Fiduciaries for non resident alien estates and trusts

There are many circumstances that require non alien residents to file with the IRS. As an example, foreign exchange students are considered to be in trade with the U.S. so they fall under the same guidelines for the taxation of non resident aliens absent any income tax treaty. Departing aliens must also obtain a certificate of compliance. PIASCIK international tax professionals are also well versed with foreign tax credits, expatriate taxation and joint tax returns.

What is taxable?

Under current IRS guidelines, there are two general types of non resident alien income subject to U.S. income tax: effectively connected income and U.S. source income that is Fixed, Determinable, Annual or Periodical (FDAP).

Effectively connected income from a trade or business in the U.S. has graduated tax rates after allocation of income and deductions. They are the same general rates U.S. citizens and residents are taxed. 

FDAP typically applies to investment income that is passive. However, it can include almost any type of income. It is taxed at a flat rate of 30 percent or lower if an applicable income tax treaty rates applies. There are no deductions for this type of taxable income.

International expertise that saves you money

Finding the right international tax expert who understands non resident alien tax filing begins with a FREE initial consultation with PIASCIK international tax advisors. Our consultants include the president of the Virginia International Business Council, and PIASCIK has been an ongoing program partner for the last 8 years with all of Virginia's inbound and outbound international programs. PIASCIK has over 90 expatriates in over 49 countries. In conjunction with over 75 years of combined international tax experience, PIASCIK international tax professionals can help you understand the taxation on non resident aliens whether you reside inside the U.S. or abroad. 

PIASCIK also provides flat rate fees with no hidden costs, unlike some larger tax accounting firms that treat you like another number. Our expert international tax professionals are convenient with 24 hours a day and 7 days a week accessibility. Contact PIASCIK today and discover why we are considered industry experts in non resident alien taxes, expatiate taxation, IC-DISC, and other international tax matters.