Preliminary Work and Taxpayer Data · Preliminary work to prepare tax returns
Residency status and citizenship
tax year · reviewed 2026-08-19 · I. Ohu
The rule
Citizenship and residency decide the most consequential question on any individual return: whether the taxpayer is taxed on worldwide income or only on income connected to the United States. A United States citizen is taxed on worldwide income wherever they live. An alien individual is taxed that way only if they are a resident alien, and an alien is treated as a resident for a calendar year if and only if they meet one of three tests (IRC § 7701(b)(1)(A)):
- The green card test — the individual is a lawful permanent resident of the United States at any time during the calendar year.
- The substantial presence test of § 7701(b)(3).
- The first-year election under § 7701(b)(4).
Anyone who is neither a citizen nor a resident under that subparagraph is a nonresident alien (§ 7701(b)(1)(B)). There is no fourth category and no partial status: the year is divided by residency starting and ending dates, not by degrees of connection.
The green card test ends in exactly three ways. Reg. § 301.7701(b)-1(b)(1) is emphatic: “Resident status is deemed to continue unless it is rescinded or administratively or judicially determined to have been abandoned.” Rescission means a final administrative or judicial order of exclusion or deportation — final meaning no longer subject to appeal. Abandonment may be initiated by the individual, by the immigration authority, or by a consular officer; where the individual initiates it, status ends when the application for abandonment or a letter stating the intent to abandon, with the registration card enclosed, is filed. Nothing else works. In particular, failing the substantial presence test does not end green card status — the two tests are alternative routes into residency, not a single test with two halves.
The substantial presence test is a weighted count. Under § 7701(b)(3)(A) an individual meets it for a calendar year if both conditions are satisfied: presence on at least 31 days of presence in the United States during the calendar yearTY2026, and a weighted total of 183 days or more, counting each day of the current year in full, one-third of each day in the first preceding year, and one-sixth of each day in the second preceding yearTY2026.
Two escape hatches. The closer connection exception in § 7701(b)(3)(B) disapplies the test where there is presence on fewer than 183 days in the current year, together with a tax home in and a closer connection to a foreign countryTY2026. It does not apply where the individual had an application for adjustment of status pending, or took other steps toward lawful permanent residence, during the year. Separately, days of presence are simply not counted for an exempt individual — 4 categories whose days are not counted — a foreign government-related individual, a teacher or trainee, a student, and a professional athlete temporarily present to compete in a charitable sports eventTY2026.
Current figures
| Item | Requirement |
|---|---|
| Substantial presence — current year | at least 31 days of presence in the United States during the calendar yearTY2026 |
| Substantial presence — weighted total | 183 days or more, counting each day of the current year in full, one-third of each day in the first preceding year, and one-sixth of each day in the second preceding yearTY2026 |
| Closer connection exception | presence on fewer than 183 days in the current year, together with a tax home in and a closer connection to a foreign countryTY2026 |
| Exempt individuals whose days are not counted | 4 categories whose days are not counted — a foreign government-related individual, a teacher or trainee, a student, and a professional athlete temporarily present to compete in a charitable sports eventTY2026 |
| ATIN qualifications | 5 — the child is legally placed in the home for legal adoption by an authorized placement agency; the adoption is domestic, or foreign with a Permanent Resident Alien Card or Certificate of Citizenship; the child's existing SSN cannot be obtained despite reasonable attempts; an SSN cannot be obtained from the SSA; and the taxpayer is eligible to claim the child as a dependentTY2026 |
| ATIN deactivation | two years from issue, with a reminder notice sent at eighteen monthsTY2026 |
How it works in practice
Do the arithmetic in the order the statute gives it. Count the current year in full, add a third of the first preceding year and a sixth of the second, and test the sum against 183 — but check the 31-day condition first, because an individual present for fewer than 31 days in the current year fails regardless of how large the weighted total is. The most common error runs the other way: computing a weighted total above 183 and stopping without confirming the current-year minimum.
Working the test backwards is a standard exam move. Given prior-year day counts, the minimum current-year presence is 183 less the weighted contribution of the two preceding years. Ninety days two years ago contributes fifteen; a hundred and twenty days last year contributes forty; the remainder needed is a hundred and twenty-eight.
Identify the residency starting date, not just the status. Section 7701(b)(2)(A) treats a first-year resident as a resident only for the portion of the year beginning on the residency starting date — the first day of presence while a lawful permanent resident for green card cases, the first day of presence in the year for substantial presence cases. That produces a dual-status year, which is a different return from either a full-year resident or a full-year nonresident return, and it is where the preparation work actually lies.
Identifying numbers follow from status, and there are three. A social security number is for those eligible for one. An ITIN is a nine-digit number the IRS issues for federal tax purposes only, to a resident or nonresident alien, or their spouse or dependent, who has a federal tax purpose and is not eligible for an SSN — available regardless of immigration status. The IRS is explicit about what an ITIN does not do: it does not qualify the holder for social security benefits or the earned income tax credit, does not provide or change immigration status, does not authorise work, and does not serve as identification outside the federal tax system.
An ATIN is for a pending adoption and nothing else. It is a temporary number for a child in a domestic adoption where the adopting taxpayers cannot obtain the child’s SSN. All five qualifications in the figures table must be met. Note what is not among them: a completed adoption. The number exists precisely because the adoption is pending — once it is final, the parents obtain an SSN and notify the IRS, which deactivates the ATIN. Absent that notification the number deactivates automatically at two years, with a reminder at eighteen months.
Counting to the minimum
Anneliese Okonkwo-Batista was present in the United States for 90 days two years ago and 120 days last year. Her adviser needs to know how many days of presence this year would make her a resident alien.
Two years ago contributes a sixth of 90, which is 15. Last year contributes a third of 120, which is 40. The two preceding years therefore supply 55 of the 183 required, leaving 128 days needed in the current year. That figure also clears the 31-day condition comfortably, so 128 is the answer. Had the prior years supplied 160 of the 183, the remainder would have been 23 — and she still would not meet the test, because the current-year minimum of 31 days is a separate requirement that the weighted total cannot satisfy.
The green card holder who moved home
Osvaldo Fitzwilliam-Adeyemi obtained a green card in 2019, moved back to his home country in 2023, and has been present in the United States only a few days a year since. He has filed nothing since 2023, on the view that he plainly fails the substantial presence test.
He is still a resident alien and has been all along, taxed on worldwide income. Resident status is deemed to continue unless rescinded or administratively or judicially determined to have been abandoned, and none of those has happened — he simply left. The remedy is prospective and procedural: file the outstanding returns, and if he intends to give up the status, file the application for abandonment or send the letter with the card enclosed, which fixes the date the status ends. Doing that in 2026 does not undo 2024 and 2025. This is the most expensive misunderstanding in this topic and it is entirely avoidable at the point the client leaves.
The graduate student who counted her days
Priyanka Vasquez-Lindholm has been in the United States on a student visa for three years, present almost every day. Her weighted total is far above 183 and she prepares to file as a resident alien.
Her days may not count at all. A student is an exempt individual under § 7701(b)(5)(A)(iii), and days on which an individual is an exempt individual are excluded from the substantial presence count — which is why the exemption is worth checking before the arithmetic rather than after. The exemption is not indefinite and has its own conditions, so the analysis is about how long she has been present in that status and whether she continues to comply with its terms. Filing the wrong return here changes not just the rate but the entire scope of income reported.
How this has changed
The architecture of § 7701(b) dates to the Deficit Reduction Act of 1984, which replaced a facts-and-circumstances residency inquiry with the objective green card and substantial presence tests that are still in force. Neither the weighted multipliers nor the 31-day and 183-day thresholds have moved since.
What has aged is the vocabulary of the regulations. Reg. § 301.7701(b)-1(b)(3) still refers to the Immigration and Naturalization Service, an agency abolished in 2003 and succeeded for these purposes by USCIS, and still cites the abandonment application as “INS Form I-407” and the registration card as “Form I-151 or Form I-551.” The regulation anticipates this and says so — directing the reader to any replacement form number — but a practitioner meeting it for the first time should read past the agency name rather than conclude the rule is obsolete. This is the same pattern as the procedural rules governing Appeals, which still speak of district directors.
On the identifying number side the practical change has been administrative rather than statutory: ITIN application and renewal procedures, the documentation the IRS will accept, and the expiration regime have all been revised repeatedly. Confirm the current requirements on the IRS ITIN pages and in the Form W-7 instructions before advising, rather than working from a remembered procedure.
Exam focus
Know the three routes to resident alien status and that they are alternatives. Be able to compute the substantial presence test both forwards and backwards — the weighted multipliers of one, one-third and one-sixth, the 183-day total, and the separate 31-day current-year condition. Know that green card status ends only by rescission or by an administrative or judicial determination of abandonment, and that failing the substantial presence test is not one of them. Know the exempt individual categories by name. On identifying numbers, know that an ATIN is for a pending domestic adoption and that a completed adoption is not a qualification for it.
Check yourself
1. Which is not a means of ending lawful permanent resident status?
A. A voluntary written statement of intent to abandon, filed with the registration card B. Failing the substantial presence test C. Administrative termination by the immigration authority D. A final judicial order of exclusion or deportation
Answer: B. Resident status is deemed to continue unless rescinded or administratively or judicially determined to have been abandoned; the substantial presence test is a separate route into residency.
2. An individual was present 90 days two years ago and 120 days last year. What is the minimum current-year presence that meets the substantial presence test?
A. 32 B. 88 C. 100 D. 128
Answer: D. The prior years contribute 15 and 40, leaving 128 of the 183 required — and 128 also clears the separate 31-day condition.
3. Which is not a requirement for obtaining an adoption taxpayer identification number?
A. The child is eligible to be claimed as a dependent B. The child’s SSN cannot be obtained from the birth parents despite reasonable attempts C. A foreign adoption has a Permanent Resident Alien Card or Certificate of Citizenship D. The adoption process has been completed
Answer: D. The number exists for a pending adoption; completion is what ends it.
4. An individual is present in the United States for 40 days in the current year and has a weighted three-year total of 200 days. What is the result?
A. Resident alien, because the weighted total exceeds 183 B. Resident alien, because presence exceeded 31 days C. Nonresident alien, unless the closer connection exception is claimed D. Resident alien only if a first-year election is made
Answer: B. Both conditions are met — 40 days exceeds the 31-day minimum and the weighted total exceeds 183 — so the test is satisfied.
5. Which of these does an ITIN do?
A. Authorise the holder to work in the United States B. Qualify the holder for the earned income tax credit C. Serve as identification outside the federal tax system D. Provide a taxpayer identification number for federal tax purposes
Answer: D. The IRS states that an ITIN does none of the other three.
Change log
- Initial draft.
Related topics
- Filing requirements and due date 1.1.1.d
- Taxpayer filing status (e.g., single, head of household) 1.1.1.e
- Taxpayer biographical information (e.g., date of birth, marital status, dependents, identity protection PIN, state issued photo ID) 1.1.1.b
- Qualifications for dependency 1.1.1.i
- Foreign account and asset reporting (e.g., FBAR, Form 8938) 1.1.1.o
- Special filing requirements (e.g. foreign income, presidentially declared disaster areas, Form 1040-NR, injured spouse) 1.1.1.n
- Sources of all worldwide taxable and nontaxable income (e.g., interest, wages, business, sales of property, dividends, rental income, flow- through entities, alimony received) 1.1.1.f
- Sources of applicable exclusions and adjustments to gross income (e.g., foreign earned income exclusion, retirement plans, HSAs, alimony paid, health insurance, self-employment tax) 1.1.1.g
- Tax treatment of a U.S. citizen/resident with foreign income (e.g., tax treaties, Form 2555, Form 3520 and Form 5471) 1.2.1.g
- Foreign tax credit 1.3.2.d