[BillyF12]

Hello, I am wondering if someone might be able to advise on the following issue:
2012 is a dual status year for me, non-resident at the end of the year. However, I I understand that I can apply the default date for residency termination of 12/31/2012, and thereby file for the whole year as a resident, without the convolution of the dual status return. Thus, I am planning to file 1040 only (jointly with my US spouse), as it does not make a difference tax wise even if I am a resident for the full year and it is a lot easier and familiar process!

It is also my understanding that I still ought to file a residency termination statement referencing 12/31/12 as my termination date, even if I am not filing dual status and claiming an early termination date.

My questions relate to the content of this statement when it is attached to a 1040 and I am a resident for the whole year.

1) Pub 519 asks me to specify the year to which the statement is applicable. I believe it to be 2012 as the termination date is the last day of that year, even though what I am effectively trying to say is that I will be a nonresident from 1/1/13 (i.e the 2013 year) on. Is this correct?

2) I believe that even though I am using the default termination date, I still ought to meet Publication 519's requirement for the statement to show the actual date my LPR status was rescinded (ie what would otherwise have been my early termination date), and also include a copy of my finalised I-407.

To avoid confusion though, perhaps I should follow this with a clarification that I am not requesting early termination, but applying the default date, and only showing the LPR info to verify that my residency has terminated for immigration purposes on that date, and thus, can be terminated for tax purposes, on 12/31/12. Is this the appropriate approach?

3) Re: the facts to provide regarding tax home in and closer connection to a foreign country: Pub 519 discusses these facts in terms of them needing to be after the termination, but in the SAME year as the termination, which is obviously not possible to do when the termination date is 12/31, and the facts will obviously relate to the next year. Does that matter? My particular facts are actually applicable for just about the whole of 2012 (and probably before) anyway, but again, would it be appropriate here for me to clarify that despite this, I am not claiming early termination, but as these facts continue to apply to date, I have included them to confirm tax home and closer connection subsequent to 12/31?

Hope the questions make sense. I know this statement is very important to establish I have left the US tax system and I want to get it right. I am not a 'long term resident' per form 8854 so I don't have to file that form, meaning this residency termination statement will be my only notification to IRS (I assume I will then not have to file anything else after 2012 unless I meet filing requirements for a nonresident?)

If any one has experience in this area and can advise me, it would be greatly appreciated! Thank you very much!

[BillyF12]

Sorry, one small addendum... since the statement would be attached to a joint 1040, must my wife (who it does not apply to) also sign the statement declaration? If so, would weneed to specify that she is a US Citizen and not terminating, and that the statement only applies to me, but that she is co-signing as it is a joint return, or something like that?

[AtlantaTaxExpert]

Since your wife is NOT terminating, she does not sign it. However, henceforth, filing a joint return will not be allowed; she will have to file her tax returns separately if she has the requisite income.

You will make the effective date 12/31/2012 (default date), even if you send a copy of the I-407.

1) Your effective termination date is 12/31/2012.

2) Yes, include the statement that shows the date your LPR status was actually rescinded. The Residency Termination Statement overrides it for tax purposes, not immigration purposes.

3) Not sure what you are asking, but your date is 12/31/2012.

[BillyF12]

3) Not sure what you are asking, but your date is 12/31/2012.

Thank you very much for your reply... much appreciated!

To give you some background re question 3), I had received some advice from a tax lawyer which muddied things a bit for me and I was trying to get further clarification from someone who might have more regular dealings with the IRS on termination statements.

According to the lawyer, the legislation/regulations don't really give me a 'choice' of the default date, but rather it is a question of fact. The requirement for a statement implies the 'choice' in that if I fail to establish an early termination, and only if I fail, then the default date applies. If, in my statement, the facts establish that I did have a closer connection etc earlier than 12/31, then the IRS should/would apply the earlier date, as that is what the legislation requires.

I.e. he said that technically, if the legislation/regulations are followed, then I can't simply 'elect' to apply 12/31. I could choose not to submit the statement at all, but then risk the IRS saying I have not left the US residence tax system for future year, or I could make the election with my US wife to be treated as a resident for tax purposes after I become a non-resident, but if I put in the statement and make full disclosure, which I ought to do, then the question is one of fact and not choice.

So I guess what I was asking is, whether there is some sort of format or wording I should be using re my facts, based on people's actual experiences filing these statements with the IRS, for the IRS to not 'force' the earlier date on me on the basis that my full disclosure of facts in the statement does lead to the conclusion that I terminated before 12/31. Since I am making a perjury declaration on the statement, I don't want to get anything wrong! Perhaps the IRS simply allows the 'choice' of 12/31 in practice even if the facts show otherwise?

Hope this clarifies the question and the reason for it! I would be interested on your opinion on it!

Thanks again for your time.

[AtlantaTaxExpert]

I have a formatted statement which I use for my clients. For a small fee, I will share it with you.

If interested, email me at the address in my profile (if you cannot see it below).

[BillyF12]

I have a formatted statement which I use for my clients. For a small fee, I will share it with you.

If interested, email me at the address in my profile (if you cannot see it below).

Thks very much - I have emailed you!

[AtlantaTaxExpert]

Email received and answered.

[zhangxuelin]

Hello, I have the same question as your #3 and was curious of the outcome.

My husband gave up his green card in July 2015 but we want to treat him as a resident alien until December 31, 2015.

The last day of residency defaults to 12/31 so if he doesn't want to establish an earlier termination date he does not have to - is this correct? Or because he filed the I-407 in July, does his residency status have to end in July? If the latter, then we would need to file the election to treat him as a resident alien married to a US spouse. If not, we won't have to use the election this year and save for another time.

Thank you very much!

[AtlantaTaxExpert]

You DO default to 31 December unless you choose the earlier date when your husband surrenders his Green Card.