Can I file New York State Tax Return as Non Resident ?
Hello,
I'm looking for some advice about my state tax return. Thank you in advance for whoever can provide some guidance.
I'm a french citizen and arrived in New York under a J-1 visa in July 2004. I filed as non resident for my 2004 tax return.
In October 2005, I obtained the H1-B status. If I understand correctly the post I read on this forum, I will still file my Federal Tax return as a non resident for 2005. Since my H1 was granted in October 2005, I do not pass the substantial presence test for this year, hence I can be considered a non resident for Tax Purposes.
I'm a little confused about New York state and New York city taxes. I have been residing in New York city ever since I arrived in July 2004, however, my current status is only valid for 3 years - so I'm wondering wether I can claim that my permanent residence is still my home country (France). I have a permanent address in France (which is my parent's address). I'm not sure wether I will be sponsored for a green card, nor if I will take this step.
Do you think I can file a New York State return as Non Resident ?
Your non-resident alien status applies only for your federal tax return.
For both the NY state and NY city tax return, you are considered a NYC resident just like everyone else, and must pay taxes (and get the credits and deductions) just like everyone else. You must file Form IT-201.
The Form IT-203 (non-resident tax return) is for those people who work in NY state, but live somewhere else (like Pennsylvania or New Jersey).
Your non-resident alien status applies only for your federal tax return.
For both the NY state and NY city tax return, you are considered a NYC resident just like everyone else, and must pay taxes (and get the credits and deductions) just like everyone else. You must file Form IT-201.
The Form IT-203 (non-resident tax return) is for those people who work in NY state, but live somewhere else (like Pennsylvania or New Jersey).
- under the France - USA treaty, I can claim an exemption for $5,000 of the income I received while I was under a J-1 Visa. In the 1040NR form, I will deduct this amount from my gross income and write this down on line 22: "Total income exempt by a treaty". Am I able to do the same for my New York Tax return ? If so, where can I specify that I'm deducting 5,000 from my income based on a tax treaty ?
- I didnt have a permanent residence in New York city for most of 2005. I started renting my own place in September 2005, but previously, I was renting a room in somebody's appartment. Furthermore, I was supposed to stay in New York only for the purpose of my internship according to the terms of my J-1 visa. Based on this circumstances, can I claim that even though I was stayig in NY state for 2005, I had no permament residence for that year and therefore should file as a Non Resident ? It is my understanding that non immigrant alien who are staying in NY for the purpose of completing a specific mission and intend can file as non resident ?
Any advice on this issue ?
I'm looking for some advice about my state tax return. Thank you in advance for whoever can provide some guidance.
I'm a french citizen and arrived in New York under a J-1 visa in July 2004. I filed as non resident for my 2004 tax return.
In October 2005, I obtained the H1-B status. If I understand correctly the post I read on this forum, I will still file my Federal Tax return as a non resident for 2005. Since my H1 was granted in October 2005, I do not pass the substantial presence test for this year, hence I can be considered a non resident for Tax Purposes.
I'm a little confused about New York state and New York city taxes. I have been residing in New York city ever since I arrived in July 2004, however, my current status is only valid for 3 years - so I'm wondering wether I can claim that my permanent residence is still my home country (France). I have a permanent address in France (which is my parent's address). I'm not sure wether I will be sponsored for a green card, nor if I will take this step.
Do you think I can file a New York State return as Non Resident ?
Thank you for your help.
Lothaire
I disagree with Atlanta tax expert. The issue is far from clear.
Unlike Federal regulations, NY State Tax code is based on INTENT not simply constructive presence and as such it involves questions of both domicile and residence. For further information on this please see the instructions on page 58 of the NY state non residency form available at http://www.tax.state.ny.us/pdf/2006/inc/it203i_2006.pdf
If you intend to return to France within the next few years (as your visa requires you to and as you were obliged to satisy USCIS at the time of issuance of your visa and DHS at the time of entry) then you clearly have strong grounds for showing that you do not have intent to establish permanent residence in New York and thus are not domiciled in New York State AND do not have 'permanent' residence.
The problem is that NY State is currently aggressively policing this.
5 years ago there would have been no question that in your case you are non-resident.
It was common practise for foreign investment bankers working in NY for as long as 5 years to file as non-residents even if they owned houses in New York and spent most of the year there.
Now on audit NY State may well challenge you and there is not much that you can do.
I would suggest you call NY state tax helpline and ask for advanced support on this to establish what is needed in order to prove that your intent is actually not to establish permanent residence.
You rebutted your own argument. While the state law seems to be rather ambiguous, the state tax authorities position is clear: you live and work in NY state, you pay NY state taxes. End of conversation!
Further, the NY state tax authorities rival the IRS in terms of their tenacity in getting the taxes they believe they are owed.
If Iruellan decided to claim non-residnet status and failed to pay the appropriate taxes, NY WILL pursue him/her back to France to get their money, and the French authorities WILL assist NY is that pursuit.
Best Iruellen pay as a resident to avoid any problems, especially if he/she has any intent of returning to the U.S.
This is incorrect. See Patrick Gallagher for a determintation clearly analagous. As you will see from this determination the issue hinges on the question of "permanent abode". If filer can provide proof of intent to return to France within 3 years then he should file NY tax as a non-resident thus declaring NY source income only. Note from the above ruling that even though the H1 visa requires holder to return to France on expiry this is not considered adequate proof. Gallagher failed as he had an open ended contract and failed to provide other proofs. Note that during J status filer is Federal Tax Exempt on Global Income (ie non US Source income) and thus files on US Source (and for NY on NY source income only.)
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