Filing U.S. taxes as a nonresident
Earning money from the United States does not stop at the border. If you live in Turkey or elsewhere and your U.S. LLC sells to American customers, you rent out property in New Jersey, or you worked in the U.S. on a visa, the IRS may expect a nonresident tax return from you each year, filed on Form 1040-NR. Many nonresidents either skip it because they think it does not apply to them, or file the wrong form because online software assumed they were residents.
We prepare federal and state returns for nonresident aliens from our office in Rochelle Park, New Jersey, and online for clients anywhere, in English or Turkish. One dedicated specialist reviews your situation, explains what applies to you and files the return on time. This is one of the tax services we focus on most.
Who must file Form 1040-NR?
You are a nonresident alien if you are not a U.S. citizen, do not hold a green card and do not meet the substantial presence test (at least 31 days in the U.S. this year and 183 days over the last three years, counted with a weighted formula). According to the IRS Instructions for Form 1040-NR, a nonresident usually must file Form 1040-NR when:
- you were engaged, or considered engaged, in a trade or business in the United States during the year, or
- you had U.S. income and the tax owed on it was not fully paid by withholding at the source.
You also file to claim a refund of tax that was over-withheld, or to claim deductions and credits. Being engaged in a U.S. business can create a filing obligation even in a year with little or no profit, so it is worth checking before you decide not to file.
Nonresident or resident: 1040 vs 1040-NR
Your visa does not decide your tax status on its own. Students, teachers and trainees on certain F, J, M or Q visas can be exempt from counting days, while other visa holders may become residents for tax purposes after enough days in the U.S. In the year you arrive or leave, you may be dual-status. We sort this out on the first call, because the wrong form means the wrong tax.
What our nonresident tax return service includes
Federal Form 1040-NR
Nonresident income falls into two groups. Income effectively connected with a U.S. trade or business is taxed at the regular graduated rates, and related deductions are allowed. Fixed or periodic income that is not connected to a business, such as many dividends, is generally taxed at a flat 30%, or a lower treaty rate, with no deductions. Nonresidents also cannot take the standard deduction or file as head of household. We classify each item correctly and credit the tax already withheld on your 1042-S, W-2 or 1099 forms.
Tax treaty benefits
The United States has income tax treaties with many countries, including a treaty with Turkey signed in 1996. Depending on the type of income and your situation, a treaty can lower or remove U.S. tax on certain income. Claiming some treaty positions requires a disclosure on Form 8833 attached to the return. We review which articles may apply to you and include the right forms. If you also need advice on how U.S. and Turkish taxes interact, that is available on request.
ITIN and identification numbers
Every 1040-NR needs a taxpayer identification number. If you are not eligible for a Social Security number, you need an ITIN. SolutionHub is an IRS-authorized Certifying Acceptance Agent (CAA), so we can prepare your ITIN application on Form W-7 and submit it together with your first return.
State nonresident returns
A state return depends on where your income comes from, not on where you live. Nonresidents with New Jersey-source income may need Form NJ-1040NR, and New York-source income is reported on Form IT-203. We check each state your income touches and prepare those returns with the federal one.
Deadlines for nonresident returns
- April 15 if you received wages subject to U.S. withholding or have an office or place of business in the United States.
- June 15 if neither applies.
- An extension with Form 4868 is available if requested by the original due date. It extends the time to file, not the time to pay.
Foreign-owned LLCs and the 1040-NR
Many of our nonresident clients are founders who formed a U.S. LLC from abroad. A single-member LLC owned by a nonresident usually files a pro forma Form 1120 with Form 5472 for the foreign-owned LLC. When that LLC actually does business in the United States, the owner may also have to report the income personally on Form 1040-NR. Our page on accounting and tax for foreign-owned LLCs explains how these filings fit together, and if the company is still new, we can also handle the EIN application.
If you moved to the U.S. and became a resident for tax purposes, you will file a regular return instead: see our individual tax preparation service.
Get your 1040-NR done right
Bring us your income documents, passport details and the dates you spent in the U.S., and we will tell you what you need to file and what it costs before any work starts. Book a free call about your nonresident return.
