Nonresident Alien Individuals (Research Assignment #1: Memo)
Nonresident alien individuals, resident alien individuals, and citizens are taxed in three different ways. Nonresident alien individuals are no taxed on all earnings. For example, business done overseas must be reported and is taxable for resident alien individuals and citizens. The same cannot be said for nonresident alien individuals; they are simply taxed on business done in the U.S. An alien is any individual who is not a U.S. citizen or U.S. national. A nonresident alien is an alien who has not passed the green card test or the substantial presence test (IRS, Taxation of Nonresident Aliens). All aliens must still file a tax return. All aliens are required to file even if: One must have no income or revenue generated in the U.S.
One must have no income or revenue generated from U.S sources Ones income or revenue is tax exempt
As previously stated, nonresident alien individuals are not taxed on all earnings but must still file a tax return. Qualifications for a resident alien individual are as follows; must meet both criterion: One has lived in the U.S for more than 31 days in the current year One has lived in the U.S for more than 183 days in the past three years If both criteria are not met, one is considered a nonresident alien and is subject to the tax laws as such. Nonresident aliens are taxed thirty percent on dividends, and are not taxed on capital gains.
Nonresident alien individuals are taxed solely on income and revenue made in the U.S. or sources from the U.S. To be considered a nonresident alien individual, one must be admitted to the U.S on a visa and leave when their purpose in the U.S has been met.
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