Complete guide: filing US tax returns for dual-status aliens

Every US resident must file an annual individual tax return. But what if you were a resident for a part of the calendar year? 

If you were both a resident and a non-resident during the same year, you are considered a dual-status alien. Though the filing process for dual-status aliens is different from that of US citizens and permanent residents, you are not exempt from filing your tax return.

Who is a dual-status alien?

A dual-status alien is someone who is treated as both a US resident and a non-resident for tax purposes during the same calendar year. This classification is based solely on your tax residency status, not your citizenship.

Your tax residency can change depending on how long you stay in the US (substantial presence test), or whether you receive a green card (green card test). 

Most dual-status situations happen when someone enters or leaves the US during the year, changing their tax status mid-year.

Substantial presence test

You meet the substantial presence test if you are physically present in the US for at least 31 days in the current year, and the total of your US presence over the current year and the two preceding years equals 183 days, using the following formula:

• Count all days from the current year.
• Add 1/3 of the days from the previous year.
• Add 1/6 of the days from the year before that.

Example – not passing the substantial presence test:

If you spent 120 days in 2025, 90 days in 2024, and 60 days in 2023 → 120 + (90 × 1/3) + (60 × 1/6) = 120 + 30 + 10 = 160 days. You do not pass the test. You’re not a US tax resident.

Example – passing the substantial presence test:

If you spent 150 days in 2025, 120 days in 2024, and 90 days in 2023 → 150 + (120 × 1/3) + (90 × 1/6) = 150 + 40 + 15 = 205 days. You pass the test. You’re a US tax resident.

Certain days do not count toward the substantial presence test, including time spent in the US on F, J, M, or Q visas, as a transit traveler, commuter from Canada or Mexico, or a crew member. Consult the Internal Revenue Service (IRS) for a full list of exemptions.

Green card test

You pass this test if you are issued a permanent resident card (Form I-551), or green card, by USCIS. 

If you meet the green card test at any time during the year – but not the substantial presence test – your residency begins on the first day you are present in the US as a lawful permanent resident.

Example: If you arrive in the US on July 1, 2025, and receive a green card that day, you are considered a non-resident from January 1 to June 30, and a resident from July 1 onward. 

Are you a green card holder? Find more information about your tax status here.

Key differences between tax residents and non-residents

The biggest distinction between residents and non-residents lies in how their income is taxed.

• Tax residents: All of your worldwide income – including foreign wages, business income, or investment gains – is taxed at progressive US tax rates, just like it is for US citizens.
• Non-residents: Only your US-sourced income is taxed. Certain types of income not effectively connected with a US trade or business are taxed at a flat 30% rate (unless reduced by a tax treaty). Non-residents cannot deduct expenses against this type of income – the 30% tax will apply to the gross amount, not net earnings.

There are several other key differences between tax residents and non-residents, related to self-employment tax, filing status, and tax deductions. 

For example, if you are self-employed, you must pay this tax during your resident period – but not while you are a non-resident. As a non-resident, you can’t claim the standard deduction – you can only claim certain itemized deductions, such as charitable contributions. 

If you were both a resident and a non-resident in the same year, you’ll file a dual-status tax return and must follow the rules for both periods. Consult with a tax professional if in doubt about your tax status and obligations.

How to file taxes as a dual-status alien

As a dual-status alien, you are considered both a resident and a non-resident in the same tax year. You will have to file two tax returns, one for each status. 

The final status on December 31 determines which IRS form is your primary return and which one becomes the supporting statement.

If you were a resident on December 31:

• Primary return: Form 1040.
• Write “Dual-Status Return” at the top.
• Supporting statement: Attach Form 1040-NR as a “Dual-Status Statement” to report your income from the non-resident part of the year.

If you were a non-resident on December 31:

• Primary return: Form 1040-NR.
• Write “Dual-Status Return” at the top.
• Supporting statement: Attach Form 1040 as a “Dual-Status Statement” to report income from your resident period.

The signature on your main return also applies to all attached schedules and statements. You do not need to sign the supporting form separately.

Tax deadlines and extensions

Your tax filing deadline depends on your tax status on December 31 of the tax year.

If you are a resident on December 31, your filing deadline for the 2024 tax year is April 15, 2025. If you are a non-resident and did not receive wages subject to US withholding, your deadline is extended to June 16, 2025.

Common mistakes and considerations for dual-status aliens

Make sure you use the right tax form

The biggest error is using the wrong primary form for your dual-status year. Remember that your residency status on December 31 determines which form to file. 

If you were a resident, file Form 1040 and attach Form 1040-NR. If you are a non-resident, file Form 1040-NR and attach Form 1040.

Filing jointly with your spouse

Non-residents generally cannot file jointly. But if your spouse is a US citizen or resident, you may elect to file a joint return. 

This will treat you as a tax resident for the entire year, allowing you to use the standard deduction, claim earned income tax credit, and access various tax benefits. But this also means that you will have to report all your worldwide income, and that tax treaty benefits will no longer apply to you. 

Pro tip. If you choose to file a joint return with your spouse, this election must be made with a signed statement and only applies if you file jointly for the full year.

If both spouses are non-residents, they must file separately, and income will be taxed at the highest possible rate.

Report all taxable income if filing as resident

Many dual-status taxpayers elect to be treated as residents but fail to report worldwide income, which is required for the resident portion of the year. 

As a US tax resident, you must report all worldwide income, regardless of foreign taxation. Capital gains may still be taxable in the US, even if exempt elsewhere.

Study tax treaties and procedures to claim benefits

If your country of residence has a tax treaty with the US, you may be able to exempt certain income from US taxation – particularly for employment and independent personal services.

The US has tax treaties with over 60 countries, but you must follow specific procedures to claim a treaty benefit. If you are a tax resident of a treaty country, for example, Spain, but do not file Form 8833 to certify an employment income exemption, the IRS may reject your claim.

Note that you don’t have to be a citizen of a treaty country – only a tax resident – to qualify for treaty benefits as a non-resident alien.

File federal and state tax returns

Some dual-status aliens mistakenly skip filing, assuming their income is exempt or foreign-sourced. However, even exempt income must be reported if you are claiming a treaty benefit, and US-sourced income received abroad may still be taxable.

You may also need to file state tax returns if:

• You are considered a resident under state rules.
• Your income is taxable at the state level.
• Your income exceeds the minimum taxable threshold.

Need help filing as a dual-status alien? Talk to a tax professional

Filing as a dual-status alien means navigating both resident and non-resident tax rules in the same year. Your forms, deductions, credits, and treaty benefits depend on your specific situation.

If this all sounds a bit too much to wrap your head around, we’ve got your back. The team at Taxes for Expats (TFX) are experts in every single tax treaty and know how to ensure that you are not double-taxed and avail of any possible credits specific to your income type and country of origin or residence.

Create your account to get started – and we’ll be happy to assist with filing your tax return. You can also book your consultation with a tax professional.