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-   -   F1 status and tax residency after 5 years. (https://www.askmehelpdesk.com/showthread.php?t=504468)

  • Sep 3, 2010, 11:23 AM
    LaCie80
    F1 status and tax residency after 5 years.
    Does an F1 student in the 6th year of their F1 visa lose their non-resident alien tax status? I came to the US in July 2005 and have been here for the most part of every year since. However, I also spent time in my home country during this tax year and while I was there (in my home country) I worked and earned income.

    Will I be obliged to pay my taxes on work in my home country in the US, if I am no longer a non-resident alien here due to the 5 year rule? Or can I claim residency in my home country and pay those taxes there? I still have my F1 visa and will be paying my taxes here on the work I do here under OPT.

    Thank you.
  • Sep 3, 2010, 04:16 PM
    wnhough
    QUOTE," Does an F1 student in the 6th year of their F1 visa lose their non-resident alien tax status? I came to the US in July 2005 and have been here for the most part of every year since"---In general, the exempt status granted to your F-1 visa expires in five years from 2005; your F1 visa status expired on 31 Dec 2009.
    In 2009, you were a non-resident alien, and should have filed Form 1040NR or NR-EZ; as you know, all F-1 students must also file IRS Form 8843 regardless of whether they have earned income in the U.S. ( For refrnce, due to a tax treaty provision between US an dIndia, ONLY students from India may claim the standard deduction on the non-resident forms.)
    "Will I be obliged to pay my taxes on work in my home country in the US, if I am no longer a non-resident alien here due to the 5 year rule?"---in 2010, you are subject to FICA,Social Security,tax withholdings if you are a resident for tax purposes ,under the US tax code. In general, F-1visa holders become ‘residents’ for tax purposes after they have been in the U.S. for 5 years.In the case of full-time students, they may retain ‘non-resident’ status beyond 5 years in certain circumstances. However, if you are a resident for U.S. tax purposes, you are under the same rules and file the same forms as a regular U.S. citizen. That means you pay tax on your worldwide income rather than just U.S. source income. A tax treaty between the United States and your home country offers a reduced rate of, or possibly a complete exemption from, U.S. income tax on the taxes that you paid on your income in your home country.
    You can visit the website for further taxation related info.; Publication 901 (2010), U.S. Tax Treaties
  • Sep 4, 2010, 06:29 AM
    AtlantaTaxExpert
    You can retain your non-resident alien status if you claim a "closer connection" to your home country. This must be done by filing Form 8840 with your 2011 tax return (Form 1040NR or 1040NR-EZ).

    However, if you are planning to apply for a H-1 or H-1B visa after completing your F-1 visa, you effectively undercut any argument you may present for closer connection.
  • Jun 2, 2012, 10:32 AM
    f1student57
    I came to the US in July 2005 on visitor visa. Later decided to go to school, and received F1 in late 2006. For purpose of non-resident alien tax status, which year is the 5 year in my case. Can anyone help please? Thanks
  • Jun 2, 2012, 02:29 PM
    newacct
    You might want to start a new thread.

    From the instructions "You will not be an exempt individual as a student if you have been exempt as a teacher, trainee, or student for any part of more than 5 calendar years." So visitor does not count. So the 5 years are 2006, 2007, 2008, 2009, 2010. So you are a resident for 2011 (sixth year).

    Quote:

    Originally Posted by f1student57 View Post
    I came to the US in July 2005 on visitor visa. Later decided to go to school, and received F1 in late 2006. For purpose of non-resident alien tax status, which year is the 5 year in my case. Can anyone help please? Thanks

  • Jun 2, 2012, 08:31 PM
    AtlantaTaxExpert
    NewAcct has it right. You are considered a resident for Tax Year 2011.

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