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Non-Resident Alien – Substantial Presence Test (SPT)

TAXATION FOR FOREIGN PERSON

Substantial Presence Test (SPT)

Who is eligible to file a US Non-Resident Alien – 1040NR tax return?


A foreign person/foreign national individual who has not passed the Substantial Present Test [SPT] or the Green Card test is eligible for filing a Non-resident Alien – 1040NR tax return. He would need to have an SSN or valid ITIN to file the tax return with the IRS tax office.


What is a Substantial Presence Test (SPT)?


The SPT [Substantial Presence Test] is the number of days present in the United States by a foreign person and these days total days cannot exceed 183 days in the current tax filing year or over 3 years.

  1. 31 days during the current year, and

  2. 183 days during the 3-year period that includes the current year and the 2 years immediately before that, counting:

  • All the days you were present in the current year, and

  • 1/3 of the days you were present in the first year before the current year, and

  • 1/6 of the days you were present in the second year before the current year.

Example for Substantial Present Test days in the USA for 2023:

If a US Person/Foreign National is physically present in the U.S. on 140 days in each of the years 2021, 2022 and 2023.

To determine if you meet the substantial presence test for 2023, 

  1. Add the full 140 days of presence in 2023,

  2. 47 days in 2022 (1/3 of 140), 

  3. and 23 days in 2021 (1/6 of 140).

Since the total for the 3 years is 210 days[exceeds 183 days], The individual foreign person in this example is considered a resident of the United States and needs to file a US tax return if the individual meets the substantial presence test for 2023.

Days of Presence in the United States

You are treated as present in the U.S. on any day you are physically present in the country, at any time during the day.

There are exceptions to this rule. Do not count the following as days of presence in the U.S. for the substantial presence test:

  • Days you commute to work in the U.S. from a residence in Canada or Mexico if you regularly commute from Canada or Mexico.

  • Days you are in the U.S. for less than 24 hours when you are in transit between two places outside the United States.

  • Days you are in the U.S. as a crew member of a foreign vessel.

  • Days you are unable to leave the U.S. because of a medical condition that develops while you are in the United States.

  • Days you are an exempt individual[i.e Foreign Government Related individual, teacher or trainee, Student, Professional athlete] 


Our team specialises in international expatriate U.S. personal tax return service. If you need assistance with US 1040 filing for refund claim/FATCA Compliance work/FBAR FINCEN114 Filing, ITIN/ Form W7 Application/EIN/Form W8BENE or Certified Acceptance Agents [CAA] services/1040NR U.S. tax filing for refund claim of excess 1042S / 8288A/ 8805/ W2/ 1099. We are happy to assist our clients in a timely, efficient, and cost-effective way.

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