Important: Please note that this article is intended for informational purposes only and does not constitute tax advice!
Your residency status in Sprintax determines whether you qualify as a resident or nonresident for tax purposes. If Sprintax identifies you as a nonresident, you can proceed with the next steps. However, if you're considered a resident for tax purposes, you'll be directed to Turbotax, our partner for resident tax filings.
The two residency tests commonly referred to in the context of determining an individual's tax residency status in the United States are:
1. The Green Card Test
- Description: If a person is a lawful permanent resident of the U.S. (i.e., they possess a green card) at any time during the calendar year, they are considered a U.S. resident for tax purposes. This holds even if they live outside the U.S., as long as their green card remains valid.
- Criteria: Being a lawful permanent resident (green card holder) under U.S. immigration law.
2. The Substantial Presence Test
- Description: This test determines residency based on the number of days a person is physically present in the U.S. during the current year and the two preceding years.
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Criteria: You are considered a U.S. resident for tax purposes if you meet both of the following conditions:
- You were physically present in the U.S. for at least 31 days during the current year.
- You were physically present in the U.S. for a total of 183 days over the current year and the preceding two years, calculated as:
- All the days you were present in the current year.
- 1/3 of the days you were present in the first preceding year.
- 1/6 of the days you were present in the second preceding year.
If you are on an F, J, M, or Q visa, you may be exempt from the Substantial Presence Test under certain conditions: F-1, J-1 (student), and M visas are exempt from the Substantial Presence Test for five calendar years over a lifetime. Holders of other J visas and the Q visa are exempt for two years out of every six proceeding years.
Info: These tests determine whether an individual is classified as a U.S. resident or nonresident for federal tax purposes. If you do not satisfy the conditions of either test, you are considered a nonresident for tax purposes. However, if you meet the criteria for either one of the two tests, you are considered a resident for tax purposes.