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Taxes for foreigners and nonresidents

US taxes for nonresidents and foreign nationals

Updated October 2026. Main source: IRS Publication 519 (U.S. Tax Guide for Aliens).

A nonresident alien pays US tax only on income that comes from US sources. What they earn in their home country is not taxed here. That is why the first step is to find out whether the IRS considers you a resident or a nonresident.

Are you a resident or a nonresident for the IRS?

For tax purposes, residency does not depend on your visa or on where your family lives. The IRS applies two tests: if you meet either one, you are a tax resident. If you meet neither, you are a nonresident.

  1. Green card test. If you were a lawful permanent resident at any time during the year, you are a tax resident for that year.
  2. Substantial presence test. You meet it if you were in the United States for at least 31 days during the year and you also reach 183 days using this formula:
    • all the days in the current year,
    • plus one-third of the days in the previous year,
    • plus one-sixth of the days in the year before that.

For example, 120 days this year, 120 last year and 120 two years ago give 120 + 40 + 20 = 180. That is short of 183, so you are a nonresident.

Days that don’t count

  • Students and teachers on an F, J, M or Q visa, for the number of years set by law. To keep those days from counting, they must file Form 8843.
  • Closer connection to another country. If you were present for fewer than 183 days in the year and keep your tax home and your ties in another country, you can claim this on Form 8840.
  • Tax treaty. Some treaties have tie-breaker rules for people who would otherwise be residents of both countries.

Which income is taxed, and how much

A nonresident’s US-source income falls into two groups.

Type of incomeExamplesHow it is taxed
Effectively connected with a US trade or business (ECI)Wages for work performed in the United States, profits from a business operating thereAt the same graduated rates as a resident, on net income
Fixed or periodic (FDAP)Dividends, rents, royalties, certain fees30% of the gross amount, withheld at source, unless a treaty sets a lower rate

Specific rules apply to some types of income:

  • Bank account interest. In general, interest on deposits in US banks is not taxed if you are a nonresident.
  • Sale of stock. In general, gains from selling stocks or bonds are not taxed, unless you spent 183 days or more in the United States that year.
  • Rental property. By default, 30% of the gross rent is withheld. You can elect to be taxed on the net amount (income minus expenses), which almost always means less tax.
  • Sale of real estate (FIRPTA). When a foreign person sells US real estate, the buyer generally must withhold 15% of the sale price and send it to the IRS. The tax return filed afterward adjusts this to the actual tax owed.

Tax treaties

A treaty can lower the 30% withholding on dividends, interest or royalties, or prevent you from being taxed twice. To claim it, you must give the payer Form W-8BEN.

  • With a treaty: Spain, Mexico, Venezuela and Chile (in force since December 2023), among others.
  • Without a treaty: Colombia, Argentina, Peru and Ecuador. Their residents pay the standard rate.

The complete list is on the IRS Tax treaties page.

Which forms a nonresident files

FormWhat it is for
1040-NRThe nonresident’s annual income tax return
W-8BENCertifies to banks and payers that you are a foreign person and, if applicable, claims treaty benefits
W-7Application for an ITIN, the tax number for people who cannot get a Social Security number
8843Excludes the days of students, teachers and other exempt individuals

Form 1040-NR is due by April 15 if you received wages subject to withholding, and by June 15 if you did not.

Without a Social Security number, you will need an ITIN to file. We explain it in what is an ITIN, and we handle the application using Form W-7.

If you own an LLC in the United States

Many of our clients are foreign nationals with a single-member LLC. The IRS does not tax that LLC itself: it attributes the LLC’s income to the owner. Even so, there is one obligation people often forget:

  • Every year you must file Form 5472 along with a pro forma Form 1120, even if the LLC had no income.
  • Failing to file triggers a substantial penalty for each form and each year.

If you plan to open one, see how to form an LLC in the United States. To operate, you will need an EIN and must keep the state Annual Report current.

State and estate taxes

  • State tax. Each state has its own rules, separate from federal tax. Florida has no personal income tax: we explain this in Florida tax advantages.
  • Federal estate tax. A nonresident has only a small exemption on assets located in the United States, such as real estate or shares of US companies. Anything above that exemption may be taxed, so it is worth planning before you buy.

Frequently asked questions

Does a nonresident alien have to file taxes in the United States?
Yes, if you had US-source income that withholding did not fully cover, or if you had a business in the United States. You file on Form 1040-NR.

How many days can I spend in the United States without becoming a tax resident?
It depends on the last three years. Under the substantial presence formula, someone who consistently spends about 120 days a year does not reach 183 and remains a nonresident.

Do I pay tax on the interest from my US bank account?
In general, no: interest on bank deposits is exempt for nonresidents. To keep the bank from withholding, you must have given it Form W-8BEN.

Does my Florida LLC pay taxes if it had no activity?
With no income, it pays no federal tax. But if its owner is a foreign national, it must file Form 5472 anyway, and failing to do so triggers a substantial penalty.

Do I need an ITIN to file?
Yes, if you do not have a Social Security number. You apply with Form W-7, usually together with your first tax return.

This content is informational and does not replace advice from a certified public accountant (CPA) or a tax attorney. The figures reflect the rules in effect in October 2026.

Have income or a company in the United States and not sure what you need to file? Book a consultation and we will review your case.

About the author
Picture of Zulma Eliana Bourelly

Zulma Eliana Bourelly

Zulma Eliana Bourelly is the founder of Riveros Corp (Riveros International Business Corp, Miami, Florida). Since 2009 she has helped entrepreneurs, companies, and religious and nonprofit organizations, both in the United States and from their home countries without traveling to the US, form and maintain their US companies and meet AML/KYC requirements. She has been a Florida Notary Public since 2010, with state registration as a Remote Online Notary (RON); a County Court Mediator certified by the Florida Supreme Court; a Certified Anti-Money Laundering Specialist (CAMS) by ACAMS; and a Certified Notary Signing Agent with the National Notary Association (NNA). She holds a law degree from the Universidad Nacional de Colombia and is not licensed to practice law in Florida or anywhere in the United States. She writes in Spanish and English about company formation, compliance and public records on US Jurisdiction, the group's blog. Service in Spanish, English and Italian. Legal notice: I AM NOT AN ATTORNEY LICENSED TO PRACTICE LAW IN THE STATE OF FLORIDA, AND I MAY NOT GIVE LEGAL ADVICE OR ACCEPT FEES FOR LEGAL ADVICE.

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