Looking for clarity and a solid reference for treatment of NON US connected income received prior to arriving in the US with a green card.
Individual initially arrives in the US August 1 with a green card visa and remains through 12/31/24. Income prior to August 1 NOT connected to the US in any way. It's clear that he should file a 1040 marked "Dual Status Return" and either an unsigned "statement" or a 1040NR (unsigned) marked "Dual Status Statement." The mystery, though, is what income to reflect on that statement and whether there is any taxation of that income.
Some sections indicate income prior to arrival is (A) NOT taxable, but (B) another indicates it's subject to a 30% tax.
(A) Instructions for Form 1040-NR, page 13, under "Income Subject to Tax for Dual Status Year", includes this language: Generally, you’re taxed on income only from U.S. sources for the part of the year you were a nonresident alien... and income you received from sources outside the United States while a nonresident alien isn’t taxable in most cases even if you became a resident alien after receiving it and before the close of the tax year. Pub 519 page 47 (Chapter 6) under Income Subject to Tax says: Income from sources outside the United States that is not effectively connected with a trade or business in the United States is not taxable if you receive it while you are a nonresident alien.
(B) HOWEVER... Pub 519 page 48, under How to Figure your Tax says: When you figure your U.S. tax for a dual-status year, you are subject to different rules for the part of the year you are a resident and the part of the year you are a nonresident.... Income that is not connected with a trade or business in the United States for your period of nonresidence is subject to the flat 30% rate or lower treaty rate.
