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. taxmap/pubs/p519-030.htm#en_us_publink1000222541
All income for your period of residence and all income that is effectively connected with a trade or business in the United States for your period of nonresidence, after allowable deductions, is added and taxed at the rates that apply to U.S. citizens and residents. 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. You cannot take any deductions against this income. taxmap/pubs/p519-030.htm#en_us_publink1000222542
During the part of the year you are a nonresident alien, 85% of any U.S. social security benefits (and the equivalent portion of tier 1 railroad retirement benefits) you receive is subject to the flat 30% tax, unless exempt, or subject to a lower treaty rate. (See The 30% Tax
in chapter 4.)
During the part of the year you are a resident alien, part of the social security and the equivalent portion of tier 1 railroad retirement benefits will be taxed at graduated rates if your modified adjusted gross income plus half of these benefits is more than a certain base amount.
Use the Social Security Benefits Worksheet in the Form 1040 instructions to help you figure the taxable part of your social security and equivalent tier 1 railroad retirement benefits for the part of the year you were a resident alien.
If you received U.S. social security benefits while you were a nonresident alien, the Social Security Administration will send you Form SSA-1042S showing your combined benefits for the entire year and the amount of tax withheld. You will not receive separate statements for the benefits received during your periods of U.S. residence and nonresidence. Therefore, it is important for you to keep careful records of these amounts. You will need this information to properly complete your return and determine your tax liability.
If you received railroad retirement benefits while you were a nonresident alien, the U.S. Railroad Retirement Board (RRB) will send you Form RRB-1042S, Statement for Nonresident Alien Recipients of Payments by the Railroad Retirement Board, and/or Form RRB-1099-R, Annuities or Pensions by the Railroad Retirement Board. If your country of legal residence changed or your rate of tax changed during the tax year, you may receive more than one form. taxmap/pubs/p519-030.htm#en_us_publink1000222544
This discussion covers tax credits and payments for dual-status aliens.taxmap/pubs/p519-030.htm#en_us_publink1000222545
As a dual-status alien, you generally can claim tax credits using the same rules that apply to resident aliens. There are certain restrictions that may apply. These restrictions are discussed here, along with a brief explanation of credits often claimed by individuals.taxmap/pubs/p519-030.htm#en_us_publink1000222546
If you have paid or are liable for the payment of income tax to a foreign country on income from foreign sources, you may be able to claim a credit for the foreign taxes.
If you claim the foreign tax credit, you generally must file Form 1116 with your income tax return. For more information, see the instructions for Form 1116 or get Publication 514.taxmap/pubs/p519-030.htm#en_us_publink1000222547
You may qualify for this credit if you pay someone to care for your qualifying child who is under age 13, or your disabled dependent or disabled spouse so that you can work or look for work. Generally, you must be able to claim an exemption for your dependent.
Married dual-status aliens can claim the credit only if they choose to file a joint return as discussed in chapter 1
, or if they qualify as certain married individuals living apart.
The amount of your child and dependent care expense that qualifies for the credit in any tax year cannot be more than your earned income for that tax year.
For more information, get Publication 503 and Form 2441.taxmap/pubs/p519-030.htm#en_us_publink1000222549
You may qualify for this credit (also known as the saver's credit) if you made eligible contributions to an employer-sponsored retirement plan or to an individual retirement arrangement (IRA) in 2009. You cannot claim this credit if:
- You were born after January 1, 1992.
- You were a full-time student.
- Your exemption is claimed by someone else on his or her 2009 tax return.
- Your adjusted gross income is more than $27,750.
Use Form 8880 to figure the credit. For more information, see Publication 590.
You may be able to take this credit if you have a qualifying child.
A qualifying child for purposes of the child tax credit is a child who:
- Was under age 17 at the end of 2009.
- Is your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, or a descendant of any of them (for example, your grandchild, niece, or nephew).
- Is a U.S. citizen, a U.S. national, or a resident alien.
- Did not provide over half of his or her own support for 2009.
- Lived with you more than half of 2009. Temporary absences, such as for school, vacation, or medical care, count as time lived in the home.
An adopted child is always treated as your own child. An adopted child includes a child lawfully placed with you for legal adoption.
See your form instructions for additional details.taxmap/pubs/p519-030.htm#en_us_publink1000222551
You may qualify to take a tax credit of up to $12,150 for qualifying expenses paid to adopt an eligible child. This amount may be allowed for the adoption of a child with special needs regardless of whether you have qualifying expenses. To claim the adoption credit, file Form 8839 with the U.S. income tax return that you file.
Married dual-status aliens can claim the credit only if they choose to file a joint return with a U.S. citizen or resident spouse as discussed in chapter 1
, or if they qualify as certain married individuals living apart (see Married Persons Filing Separate Returns
in the Form 8839 instructions).
You can report as payments against your U.S. income tax liability certain taxes you paid, are considered to have paid, or that were withheld from your income. These include:
- Tax withheld from wages earned in the United States,
- Taxes withheld at the source from various items of income from U.S. sources other than wages,
- Estimated tax paid with Form 1040-ES or Form 1040-ES (NR), and
- Tax paid with Form 1040-C, at the time of departure from the United States.