Substantial Presence Test for first yr (TN visa)

slkching · Post by **slkching** » Tue Apr 02, 2013 4:07 pm

I am having difficulty to understand the substantial presence test for TN status

The following taken from IRS site:
The "Substantial Presence Test"

A foreign national in non-immigrant visa status may be considered a resident for tax purposes as soon as he/she meets the "substantial presence" test for a calendar year (January 1 to December 31). To meet this test, the person must be physically present in the U.S. on at least:

31 days during the current calendar year and
183 days during the three-year period that includes the current calendar year and the two years immediately preceding. The individual should count: all the days he/she was present in the U.S. in the current year, 1/3 of the days present in the U.S. the preceding year, and 1/6 of the days present the year before that.

1) So i am filing for year 2012. When they say current calendar year, do they mean year 2013 or year 2012 in US? because that pretty much determine whether i am resident or not.

If the current calendar year count as 2013, then that is only 4 months right now (i was away for 1 month), which is approx 90 days. and i started working in US since May 8th, 2012 and gone for 2 weeks during christmas. 1/3 of 7 months - 2 weeks away for christmas is only 2 months (approx 60 days). Base on that, it would be only be around 150 days.

On the other hand, if the current calendar year count as 2012, then of course i stay more than 183 days in US.

2) I bought a vehicle in late July 2012, can i file that for deduction regardless of what status (resident or non-resident)?

nelsona · Post by **nelsona** » Tue Apr 02, 2013 4:17 pm

spt for 2012 is based on 2012, 2011, and 2010.

As a Cdn you are allowed to file a full year 1040, as long as you report all world income. This is usually better than filing dual-status, so do that. since you meet SPT, you are therefore considered resident from first day you wer in US in 2012.

2. What deduction?

slkching · Post by **slkching** » Tue Apr 02, 2013 4:24 pm

1) Well i just graduated in the first few days of Jan 2012, so i only get paid like $80 in Canada. Should i need to include that in my 1040?

2) those itemized deduction or sale tax deduction thing for the car i bought in July, 2012. Am i eligible for that?

nelsona · Post by **nelsona** » Tue Apr 02, 2013 4:31 pm

1) yes. Income is income. You also need to file a departure return for canada, even if you owe no tax, so that they know you are gone, and you take care of any departure requiremnts, like stopping GST, etc. There is an emigrant guide on CRA website

2) You can clim anything you are leigible for from anytime in the year. Besides, you were resident in July.

Just don't ask how to claim it. Get software and they will guide you.

c6collin · Post by **c6collin** » Tue Apr 02, 2013 10:27 pm

Hi Nelsona. I was wondering if you can clarify filing a full year 1040. I am in a similar situation in that I meet the SPT for 2012. I would like to be treated as a resident alien for the full year rather than filing dual-status, but I can't make the choice mentioned in pub 519 since I am single. Is there another choice we can make and form to fill out?

Thanks

nelsona · Post by **nelsona** » Wed Apr 03, 2013 6:54 am

The right to file full year is available to ALL Cdns, by treaty.

c6collin · Post by **c6collin** » Thu Apr 04, 2013 1:32 am

Just to clarify, do I need I file 8833 as mentioned in http://forums.serbinski.com/viewtopic.p ... 76d723f5bd to state I am using Article XXV(1)?

Thanks for the help.

nelsona · Post by **nelsona** » Thu Apr 04, 2013 6:47 am

Although not absolutely necessary, it is always good to tell the IRS exactly what you are doing, so 8833 in this case would be advisable.

c6collin · Post by **c6collin** » Thu Apr 04, 2013 10:48 pm

Great. Thanks for the help.