W-4 Residency Status - NRA or Resident?

[Daphne_T]

I've been under F-1 status since August 2017 and just started my OPT this January 2023. However, in 2021, I went back to my home country for the whole year due to Covid, and studied online the entire year. I came back to the US in January 2022 and stay here till now. Would my 5-year exemption as Nonresident Alien for student visa count the year of 2021, which makes me a Resident status now? Or rather, when will I need to change my withholding status to Resident? Thank you.

Here's the timeline of my presence in the US for better understanding:

    Aug 2017- Aug 2020 : F-1, present in US

    Aug 2020 - Dec 2021: F-1, not in US

    Jan 2022 - now: F-1, present in US

[ErnieS0 · Accepted solution]

You are still a non-resident for tax purposes. The exempt periods cover any part of a year. Because you were not present in the U.S. for all of 2021, that year does not count. You are now in your fifth year (2017, 2018, 2019, 2020, and 2022).

TurboTax does not support nonresident returns.

File with TurboTax partner Sprinitax.com.

[Daphne_T]

Thanks for the help! 

[Daphne_T]

Another question, does that mean my residency starting date is 01/01/2023? I'd be staying in the U.S this whole year.

[ErnieS0]

Yes. Your starting residency date is Jan. 1, 2022.

The IRS provides this example:

W was a citizen and resident of a foreign country immediately prior to entering the United States. W is temporarily present in the United States as a graduate student at a university on an F-1 visa (student visa) and had never been in the United States before arriving on 08-15-2017. Assuming W substantially complies with the requirements of the visa, does not change immigration status, and remains in the United States throughout 2022, determine W’s residency starting date.

Solution:
Date of entry into United States: 08-15-2017
Student F-1 visa
Exempt individual for 5 calendar years (2017 through 2021)
To determine whether W met the substantial presence test (183 days), begin counting days on 01-01-2022.
Number of nonexempt days in United States during 2022: 365 days

Count days as follows:
Current year (2022) days in United States (365) × 1 = 365 days
Prior year (2021) days in United States (0) × 1/3 = 0 days
Year before that (2020) days in United States (0) × 1/6 = 0 days
Total = 365 days

W met the substantial presence test on 07-02-2022 (the 183rd day of 2022). W's residency starting date under IRC § 7701(b) is 01-01-2022, first day of presence in the United States during the calendar year in which W met the substantial presence test.

See Tax Residency Status Examples