Nonresident Alien

Nonresident Alien

A Nonresident Alien is an individual who is not a U.S. citizen and does not meet the criteria to be considered a resident alien for tax purposes. This status typically applies to foreign nationals who are temporarily residing in the United States and do not meet the "substantial presence test" or do not have a green card.

Nonresident aliens are taxed only on their U.S.-sourced income, which includes wages earned from a U.S. employer, dividends from U.S. corporations, and interest from U.S. banks. They are generally required to file Form 1040-NR, the U.S. Nonresident Alien Income Tax Return, to report this income and any applicable tax liabilities.

For example, a foreign student studying in the U.S. on a temporary visa may be classified as a nonresident alien if they do not meet the substantial presence test, meaning they haven’t been in the U.S. long enough over the past three years to qualify as a resident for tax purposes.