If you receive your greencard mid-tax-year, will you be able to apply the standard deduction towards earnings from the beginning of the year (while on a different visa)?

Forum|Forum|2 years ago
September 26, 2023
4 replies
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pk_

Level 15

@nickschnecke , a GreenCard granting makes the holder a resident for the tax year. However , the start of the year depends on the first day of the present in the USA. Thus , if you got your GreenCard on October 10th ( admission date shown on the card ) and you entered the USA on July 1st. of the same year on a work visa , then your Residency begins on July 2nd ( first full day ) of the year.

Here is a doc from the IRS --- Residency Starting and Ending Dates | Internal Revenue Service (irs.gov)

You are eligible for Standard deduction if , and only if , you are a resident for the full calendar year.

Hope this clarifies the situation .

Is there more I can do for you ?

AmeliesUncle

Level 15

@pk12_2 wrote:
@nickschnecke , a GreenCard granting makes the holder a resident for the tax year. However , the start of the year depends on the first day of the present in the USA. Thus , if you got your GreenCard on October 10th ( admission date shown on the card ) and you entered the USA on July 1st. of the same year on a work visa , then your Residency begins on July 2nd ( first full day ) of the year.

In your example, they would have met the Substantial Presence Test. But if they did not meet the Substantial Presence Test, then residency in your example would start on October 10th, right?

If they were in the US on an 'exempt' visa, they would still be Dual Status aliens regardless of when they came to the US (even if they were "present" in the US in 2021) and would therefore not qualify for the Standard Deduction.

If I remember correctly, TurboTax is not set up for Dual Status Aliens (for example, it doesn't write Dual Status on top, and of course it doesn't prepare the 1040NR). For this year, I recommend going to a good tax professional that is experienced with Nonresident and Dual Status Aliens.

pk_

Level 15

@AmeliesUncle , thank you for pointing out these issues ( while this is well articulated in the doc from the IRS )

You wrote ( my answers are in BOLD:

In your example, they would have met the Substantial Presence Test. But if they did not meet the Substantial Presence Test, then residency in your example would start on October 10th, right? Correct --- thus if you entered the country on say July 31st ( and therefore you cannot meet the SPT in the calendar year ), but you meet the GreenCard test on 10/10/XX , then your residency starts on 10/10/XX

Thank you @AmeliesUncle

Opus 17

Level 15

Note that if you are considered a dual-status alien for 2023, Turbotax doesn't support that situation. You will need to find another tax preparer or file on your own.