What is a Resident Alien?

At a glance

What is a resident alien? Find out the definition and see how it may affect your tax return with help from the tax experts at H&R Block.

Image for What is a Resident Alien?

If you’re a citizen of another country and you live and work in the United States, you may qualify as a resident alien.

There are two different ways to qualify as a resident alien in the U.S.:

  1. You pass the Green Card test
  2. You pass the substantial presence test

For the green card test, you’re considered a resident alien if you are legally living permanently in the United States as an immigrant. You have this status if you have an alien registration card, (known by you and I as a green card).

Resident aliens and the substantial presence test

The substantial presence test is pretty much what it sounds like: a test to determine if you’ve spent enough time in the United States to be considered a resident alien. You pass the test if you were physically present in the U.S. at least 183 days over three years, which would include a minimum of 31 days during the current year. This includes:

  • All the days you were present in the current year
  • 1/3 of the days you were present in the first year before the current year
  • 1/6 of the days you were present in the second year before the current year

The difference between a Resident Alien and a Nonresident Alien

If you don’t qualify as a resident alien, you might be considered a nonresident alien. The definition of a nonresident alien is someone who’s legally in the U.S. for a short time or who doesn’t have a green card. The main difference between the two is the paperwork and what income is taxed.

Resident aliens in the U.S. owe taxes on their entire income (regardless where it was earned), while the non-resident alien tax rate only applies to taxes on the income from U.S. sources.

In some cases, you can still be considered a nonresident alien even if you meet the substantial presence test. To qualify, you must:

  • Hold certain visas
  • Have a closer connection to a foreign country than to the United States.

Dual status aliens

In some cases, you can be considered both a resident and a nonresident alien, known as a dual status alien. These cases usually happen the year you arrive or depart from the U.S.

Resident Alien taxes in the U.S.

A common question our tax advisors get is “what taxes to resident aliens have to pay?” Good question!

All resident aliens need to pay U.S. taxes. Just like a U.S. citizen, you need to report all income, regardless if you earned it in the U.S. or abroad. This includes:

  • Interest
  • Dividends
  • Wages or any other compensation for your services/products
  • Income from rental properties
  • Royalties
  • Other income you receive

If you’re an alien and you leave the U.S., you must get a certificate of compliance that proves you’ve paid your U.S. taxes. If you don’t, you must file and pay at your point of departure. Before you leave, be sure to download or take a look at Form 1040-C or Form 2063 to find out what you need to report.

Need tax help as a Resident Alien? Trust the experts at H&R Block

Have any more questions about resident alien status? We are here to help. Get started with virtual Expat Tax Preparation from H&R Block today.

Was this article helpful?

See what expats have to say about their experience with us.

Kristi Heinz

H&R Block Expat Tax has always been fast, efficient and answers my questions. For 10 years I filed everything myself and never received a refund. Now I get a big refund every year! Wish I had known sooner. I highly recommend HRB Expat Tax.

Arkadiusz Malinowski

H&R Block U.S. Expat Tax Services does a really great job! Fast and reliable. Tax Organizer was very easy to use. And what I really like most is very quick and precise answers whenever you have a question. Thank you!

Ayesha Sultan

I live in Kenya now and run my own online digital marketing business. Using this service has helped me save tons of time and energy on my taxes. I am also really relieved that they will help if I need it during audits. It really makes living abroad and doing taxes a million times better.

Jennifer Thompson

I have been using H&R block for a few years now. I live abroad, but don't make a lot of money. Filing with H&R block is as painless as doing taxes gets and my Advisor is wonderful and answers all my questions.

Alison Watts

Expat taxes made easy. I had a great experience this year - I used HR Block last year and was very impressed with the efficiency and accuracy and professionalism throughout the whole process.

Image for No one offers more ways to get tax help than H&R Block.

No one offers more ways to get tax help than H&R Block.

Easy online filing designed for expats. Experienced experts if you need them. Get your taxes done in the way that’s right
for you.