Tax reporting after becoming LPR and working overseas

[Vasilijf97]

Hello. I'm planning to get a green card after winning in DV lottery and become a US resident in August 2025. Currently I live in Serbia and work for a company here. (as I understand Serbia doesn't have tax treaties with the U.S) , and planning to work here up until March 2026. I'm planning to enter the U.S in August, stay there for 3 weeks and leave back to Serbia (planning to stay 3 weeks only in the U.S in 2025) . Do I need to file my taxes on income from the beginning of 2025? Or from August 2025 (date when i become LPR) ? Am I eligible for foreign income tax exclusion (I pay taxes in Serbia)? Am I eligible for Standard deduction? Am I going to eventually end up paying double taxes in the U.S and Serbia? (In 2025 I'm going to make around 40000 USD gross for the entire year and pay 10 percent income tax in Serbia) If yes, are there any ways to avoid it? 

[Vanessa A]

Do I need to file my taxes on income from the beginning of 2025? No, you will not need to file a return unless you have US sourced income or if you are not in the US for income earned prior to getting your green card. 

 Or from August 2025 (date when i become LPR) ? Yes, if you have taxable income, you will need to file a US form 40 beginning with the date you become a legal Resident. 

Am I eligible for foreign income tax exclusion (I pay taxes in Serbia)?  Probably. It sounds like this may apply to you?  If it does then  yes, you can claim the foreign income exclusion.  Otherwise, no since Serbia does not have a tax treaty with the US. A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries ...  If this

 Am I eligible for Standard deduction?  Yes, if you have taxable income you can use the Standard Deduction when filing a form 1040 as a US Resident in future years when you have been a resident for the entire year.  However, if all of your income is excluded in future years, this would not be relevant. 

 Am I going to eventually end up paying double taxes in the U.S and Serbia? Possibly, but probably not.  It depends on your earnings and the tax rates you pay over there versus here.  For 2025, the foreign income exclusion is limited to $130,000.  However, it is possible to take the foreign tax credit instead of the exclusion which may reduce the amount of taxes you would pay to the US if any. You would have to see which one puts you in a better tax position. 

 If yes, what are the ways to avoid it? As stated above, you can take the foreign income exclusion or foreign tax credit to reduce double taxation. You can only take one or the other. 

@Vasilijf97 (Edited 2/13/2025 @ 9:50AM PST)

[Vasilijf97]

as for Standard deduction - aren't you eligible for it if you are a resident for the full calendar year? 

[Vanessa A]

Yes, you are eligible for it when you have been a resident for the entire year.  So in 2026, as long as you do not give up your residency rights, you would be able to claim the standard deduction. However, if you do not have any US taxable income again in 2026, it will not have any affect on your return.  A standard deduction reduces your taxable income, but it will not reduce it below $0.  So if all of your income is excluded, this would not have any affect on your return. 

For 2025, you would not be able to claim the standard deduction as a dual status alien. You would be able to itemize your deductions, but again, this works the same ways as the standard deduction.  in that, if you do not have US taxable income, it will not have an affect on your return as in giving you any type of additional refund, as your taxable income cannot be reduced below $0.