Posted: February 28th, 2011 | Author: admin | Filed under: Did you know? | Tags: 1040nr, physical presence usa, Pub 519, substantial presence, us tax, US territorial waters | No Comments »
Maritime territory of the United States
this blog post is intended to shed some light on the topics discussed in publication 519 of the IRS on substantial presence.
The Government of the United States of America has claims to the oceans in accord with international law, which delineates a zone of territory adjacent to territorial lands and seas. United States protects this marine environment, though not interfering with other lawful uses of this zone. The United States jurisdiction has been established on vessels, ships, and artificial islands (along with other marine structures).
The primary enforcer of maritime law is the United States Coast Guard. Federal and state governments share economic and regulatory jurisdiction over the waters owned by the country. (See tidelands.)
The Exclusive Economic Zones of the United States
International law concerning United States territory
The United States is not restricted from making laws governing its own territory by international law. The United States territory can include occupied territory, which is a geographic area that claims sovereignty, but is being forcibly subjugated to the authority of the United States of America. United States territory can also include disputed territory, which is a geographic area claimed by United States of America and one (or more) rival governments.
Like most nations, the United States of America has acquired territory by force and conquest (Latin, “to seek for“). Internationally (specifically according to the Hague conventions), United States territory can include areas occupied by and controlled by a United States army. When de facto military control is maintained and exercised, occupation (and thus possession) extends to that territory. By convention, the forces in control of the territory have a responsibility to provide for the basic needs of individuals under their control (which includes food, clothing, shelter, medical attention, law maintenance, and social order). To prevent systematic abuse of puppet governments by the occupation forces, they must enforce laws that were in place in the territory prior to the occupation.
Britannica Concise Encyclopedia:
Waters under the sovereign jurisdiction of a nation or state, including both marginal sea and inland waters. The concept originated in the 17th-century controversy over the status of the sea. Though the doctrine that the sea must be free to all was upheld, a nation’s jurisdiction over its coastal waters was also recognized. Nations subscribing to the Law of the Sea observe a territorial limit of 12 nautical mi (22 km) from shore. Territorial rights include the airspace above those waters and the seabed below them. See also high seas.
territorial watersThe coastal waters together with the sea bed beneath them and the air space above them, over which a state claims sovereignty. Traditionally, this area included all the coastal waters up to three nautical miles from the coast. The definition of a landward baseline has been problematical for countries, such as Norway, with an indented coastline. In such cases, a baseline is drawn to link the major promontories.
The extent claimed from the baseline varies. Most countries claim twelve nautical miles. In 1983, the Law of the Sea Convention proposed a 200 nautical mile exclusive economic zone with rights over the sea and the resources of the sea bed. It has not been possible to demarcate such zones over most European waters since the nations are less than 400 nautical miles apart. In such cases, a median line is drawn between the baselines of the states concerned.
Gale Encyclopedia of US History:
Territorial Sea is a belt of coastal waters subject to the territorial jurisdiction of a coastal state. The territorial jurisdiction of the coastal state extends to the territorial sea, subject to certain obligations deriving from international law; the most significant of which is the right of innocent passage by foreign ships. The distinction between the territorial sea, in effect an extension of exclusive coastal state sovereignty over its land mass and the high seas, a global commons beyond the reach of any state’s jurisdiction, dates at least to the early eighteenth century in Europe.
A limit to the territorial sea of three nautical miles from the coast was accepted by many countries until the latter part of the twentieth century, including by the United States, which claimed a three-mile territorial sea dating from the beginning of the republic. A United Nations–sponsored conference in 1958 adopted four major multilateral agreements on the law of the sea, but failed to secure an international agreement on a compromise limit to the territorial sea. The United States, along with other maritime powers such as the United Kingdom, Japan, and the Netherlands, argued for the traditional three-mile limit so as to preclude coastal-state encroachments into the navigational freedoms of the high seas. A second UN conference convened in 1960 was similarly unsuccessful. The Third United Conference on the Law of the Sea, initiated in 1973, adopted a major new multilateral convention in Montego Bay, Jamaica, in 1982. That agreement confirmed the emerging trend toward a twelve-mile limit. Although the United States is not a party to the 1982 convention, President Reagan in December 1988 claimed a twelve-mile territorial sea on behalf of the United States.
According to the Montego Bay convention, which has emerged as the international standard even for those states not party to it, measurement of the territorial sea from convoluted shorelines may be made from baselines connecting headlands. Baselines are also used for bays and estuaries with headlands not over twenty-four miles apart, between outer points of coastal inland chains that enclose internal waters, and for historic bays to which territorial claims have been established by long and uncontested use.
The territorial sea is now but one component of a larger international legal regime governing the interests of coastal states in their adjacent waters. The United States, like many states, claims limited jurisdiction in a “contiguous zone” of twelve additional miles beyond the territorial sea to enforce customs, fiscal, immigration, and sanitary laws, and to punish violations of its laws committed in its territory or territorial sea. U.S. courts have supported the arrest of smugglers hovering beyond territorial waters with the intent to violate customs laws. Legislation authorizing a four-league customs-enforcement zone was protested by other countries, but during Prohibition several countries agreed by treaty to arrests within a one-hour sailing distance from shore.
Many countries, following President Harry S. Truman’s proclamation in 1945, have claimed jurisdiction over continental shelves extending off their coasts. This form of jurisdiction extends to the seabed and not the water column above it, primarily for the purpose of exploiting resources such as oil and gas. The extent of the continental shelf may vary, depending on the shape of the sea floor. “Exclusive economic zones,” which govern the use of the water column primarily for the purposes of fishing, may extend up to 200 nautical miles from a coastal state’s baseline. In 1983 President Reagan claimed an exclusive economic zone of 200 nautical miles on behalf of the United States.
Posted: February 5th, 2011 | Author: admin | Filed under: Open Opinions | Tags: 1040nr, grass is always greener, physical presence usa, Pub 519, substantial presence, the grass is always greener on the otherside, us tax, US territorial waters | No Comments »
Esta misma entrada blog esta disponible en español aquí
Hi everybody it’s me Juan your friendly US Colombian Expat living in Bogota.
Allow me to introduce myself. I was born and raised in Miami Beach, FL I’m 29 years old this month so get your birthday wishes ready.
which grass am I standing on?
Is that the other side?
Today I want to talk about an old phrase;
“the grass is always greener on the other side”
and does it still apply today?
Additionally in this blog/open discussion, how it applies to the Latin American culture and our fascination with the United States and its American dream. I don’t intended to devalue the US and the opportunities it offers foreigners but I would like to analyze and create the launch pad for an open discussion or debate on the state of mind that makes people crave living in the US, Europe and or any other country other than their own.
I’d like to site some pretty compelling articles on the topic that I found and I think are relevant and make a good point on the matter. I like fair and balanced arguments from different points of view so I’ll try and provide articles or links that either counter my view or propose a positive where maybe I see a negative.
Ok so now that I got that out of the way allow me to spill my guts on the matter!
I think one important observation is where the migration is coming from and where it’s going to.
From what statistics are showing the highest concentration of immigrants are coming from either Latin American, Central American, Asian and some European countries and they’re heading to the states primarily and Europe. So what’s this all due to?
Now as a disclaimer a lot of this part is purely my conjecture and opinion. However I also speak from experience as living here in South America specifically Colombia and even more specifically in the capital city of Bogota I am constantly bombarded by Colombian nationals, friends, colleagues, Associates or people just passing by who simply revel in the United States, it’s style of life, malls, television, food choices, clothing and work opportunities. With the exception of the latter when you review what these people are interested in the United States for. You realize after having lived there, that there is nothing being mentioned of any real substance or benefit to the overall human experience. I mean really a shopping mall? Television? And then for food choices Burger King, ARBY’s, McDonald’s, Kentucky fried chicken? Are you kidding me? And that’s when I have to take a step back and applaud the work the effort and dedication that the marketing agencies of the United States have put into worldwide exposure of all their nice shiny crap, preconditioning people worldwide.
Me on the other hand Living here in South America, Colombia I have not only had the opportunity to enjoy homemade meals just about every day of the week for $6 thousand pesos (approximately $3 dollars) I look back at the times when I would pay 20 dollars to get poisoned at a drive thru! Organic food in this country is cheap and accessible. Something that we call here a Criollo (organic) chicken for example which is a chicken that was raised without any hormones fed corn and other natural vegetable products. Chicken that is not associated with thyroid cancer, hyperthyroid, hypothyroid, attention deficit disorder in children and massive rapid obesity in adolescents… Just a few of the side effects associated with eating that unnaturally fat 13-day-old chicken.
So I guess basically the point I’m getting to in this short blog and that I would like to open up for debate. Is that at this point in my life I can’t help but stand in awe at the power and reach that propaganda has achieved and its ability to make people all over the world over look the ugly reality of the situation. I understand its position and the part it plays in our capitalist society and the need that companies have to utilize these machines in order to increase their profit. My question here would be what’s the effect it’s having on human evolution and the development of our society? Is the future going to be like the movie wall-e proposed? Worldwide?
Again this Blog is written by Juan and his opinions are entirely his own and not those of 1040NR tax returns unless you agree with him (lol)
Posted: February 4th, 2011 | Author: admin | Filed under: TAX GUIDE for Aliens | Tags: 1040nr, Non resident alien, physical presence test, Pub 519, substantial presence, tax guide, tax guide 3, us tax, us tax guide, US territorial waters | No Comments »
Articulo en Español
Nonresident Alien or Resident Alien?
You should first determine whether, for income tax purposes, you are a nonresident alien or a resident alien. Figure 1-A will help you make this determination.
If you are both a nonresident and resident in the same year, you have a dual status. Dual status is explained later. Also explained later are a choice to treat your nonresident spouse as a resident and some other special situations.
· How to determine if you are a nonresident, resident, or dual-status alien, and
· How to treat a nonresident spouse as a resident alien.
You may want to see:
Form (and Instructions)
o 1040 U.S. Individual Income Tax Return
o 1040A U.S. Individual Income Tax Return
o 1040NR U.S. Nonresident Alien Income Tax Return
o 8833 Treaty-Based Return Position Disclosure Under Section 6114 or 7701
o 8840 Closer Connection Exception Statement for Aliens
o 8843 Statement for Exempt Individuals and Individuals With a Medical Condition
See chapter 12 for information about getting these forms.
If you are an alien (not a U.S. citizen), you are considered a nonresident alien unless you meet one of the two tests described next under Resident Aliens.
Green Card Test
You are a resident for tax purposes if you are a lawful permanent resident of the United States at any time during calendar year 2009. (However, see Dual-Status Aliens, later.) This is known as the “green card” test. You are a lawful permanent resident of the United States at any time if you have been given the privilege, according to the immigration laws, of residing permanently in the United States as an immigrant. You generally have this status if the U.S. Citizenship and Immigration Services (USCIS) (or its predecessor organization) has issued you an alien registration card, also known as a “green card.” You continue to have resident status under this test unless the status is taken away from you or is administratively or judicially determined to have been abandoned.
Resident status taken away. Resident status is considered to have been taken away from you if the U.S. government issues you a final administrative or judicial order of exclusion or deportation. A final judicial order is an order that you may no longer appeal to a higher court of competent jurisdiction.
Resident status abandoned. An administrative or judicial determination of abandonment of resident status may be initiated by you, the USCIS, or a U.S. consular officer.
If you initiate the determination, your resident status is considered to be abandoned when you file either of the following with the USCIS or U.S. consular officer.
- Your application for abandonment.
- Your Alien Registration Receipt Card attached to a letter stating your intent to abandon your resident status.
You must file the letter by certified mail, return receipt requested. You must keep a copy of the letter and proof that it was mailed and received.
If the USCIS or U.S. consular officer initiates this determination, your resident status will be considered to be abandoned when the final administrative order of abandonment is issued. If you are granted an appeal to a federal court of competent jurisdiction, a final judicial order is required.
Under U.S. immigration law, a lawful permanent resident who is required to file a tax return as a resident and fails to do so may be regarded as having abandoned status and may lose permanent resident status.
A long-term resident who ceases to be a lawful permanent resident may be subject to special reporting requirements and tax provisions. See Expatriation Tax in chapter 4.
Termination of residency after June 3, 2004, and before June 17, 2008. If you terminated your residency after June 3, 2004, and before June 17, 2008, you will still be considered a U.S. resident for tax purposes until you notify the Secretary of Homeland Security and file Form 8854, Expatriation Information Statement.
Termination of residency after June 16, 2008. For information on your residency termination date, see Former long-term resident under Expatriation After June 16, 2008, in chapter 4.
Disclaimer: This is our Interpretation of the IRS publication 519
Posted: January 29th, 2011 | Author: admin | Filed under: TAX GUIDE for Aliens | Tags: 1040nr, Non resident alien, physical presence test, Pub 519, substantial presence, tax guide, tax guide 3, us tax, us tax guide, US territorial waters | No Comments »
Article available in Spanish/En Espanol
What’s New for 2010
IRA deduction expanded. You may be able to take an IRA deduction if you were covered by a retirement plan and your 2010 modified AGI is less than $66,000 ($109,000 if married filing jointly or qualifying widow(er)). If your spouse was covered by a retirement plan, but you were not, you may be able to take an IRA deduction if your 2010 modified AGI is less than $177,000.
Repayment of first-time homebuyer credit. If you claimed the first-time homebuyer credit a home you bought in 2008, you must begin repaying it in 2010. See Form 5405 for details.
Personal exemption and itemized deduction phaseouts ended. For 2010, taxpayers with adjusted gross income above a certain amount will no longer lose part of their deduction for personal exemptions and itemized deductions. Under current law, these phaseouts will resume in 2011.
Earned income credit (EIC). You (if you are a resident alien) may be able to take the EIC if:
- Three or more children lived with you and you earned less than $43,352 ($48,362 if married filing jointly),
- Two children lived with you and you earned less than $40,363 ($45,373 if married filing jointly)
- One child lived with you and you earned less than $35,535 ($40,545 if married filing jointly), or
- A child did not live with you and you earned less than $13,460 ($18,470 if married filing jointly).
The maximum AGI you can have and still get the credit also has increased. You may be able to take the credit if your AGI is less than the amount in the above list that applies to you. The maximum investment income you can have and get the credit is still $3,100.
Personal casualty and theft loss limit reduced. Each personal casualty or theft loss is limited to the excess of the loss over $100 (instead of $500).
Expiring tax benefits. The following benefits are scheduled to expire and will not be available for 2010.
- Deduction for educator expenses in figuring adjusted gross income.
- Tuition and fees deduction.
- Increased standard deduction for real estate taxes or net disaster loss.
- Itemized deduction or increased standard deduction for state or local sales or excise taxes on the purchase of a new motor vehicle.
- Deduction for state and local sales taxes.
- The exclusion from income of up to $2,400 in unemployment compensation.
- The exclusion from income of qualified charitable distributions.
- Government retiree credit.
- District of Columbia first-time homebuyer credit (for homes purchased after 2009).
- Extra $3,000 IRA deduction for employees of bankrupt companies.
- Certain tax benefits for Midwestern disaster areas, including the additional exemption amount if you provided housing for a person displaced by the Midwestern storms, tornadoes, or flooding.
Exemption for certain distributions from mutual funds expires. The exemption from the 30% tax on certain interest-related dividends and short-term capital gain dividends received from a mutual fund or other regulated investment company expires for dividends for tax years of the company beginning after 2009. See Dividend Income in chapter 3.
Third party designee. You can check “Yes” box in the “Third Party Designee” area of your return to authorize the IRS to discuss your return with a friend, family member or any other person you choose. This allows the IRS to call the person you identified as your designee to answer any questions that may arise during the processing of your return. It also allows your designee to perform certain actions such as asking the IRS for copies of notices or transcripts related to your return. Also, the authorization can be revoked. See your income tax package for details.
Change of address. If you change your mailing address, be sure to notify the Internal Revenue Service using Form 8822, Change of Address.
Posted: January 18th, 2011 | Author: admin | Filed under: non-resident and residents | Tags: 1040nr, Non resident alien, physical presence test, Pub 519, substantial presence, tax guide, tax guide 3, us tax, us tax guide, US territorial waters | No Comments »
Welcome to 1040NR’s online tutorial and information archive for foreign nationals, or more specifically nonresident aliens of the U.S.
(Clic aquí para la versión en Español de este articulo/ for Spanish version click here)
Over the next months we will be building and offering you the non-resident information to clearly establish your status and the steps necessary to follow for filing your U.S. tax return.
For tax purposes, an alien is an individual who is not a U.S. citizen. Aliens are classified as nonresident aliens and resident aliens. Nonresident aliens are taxed only on their income from sources within the United States and on certain income connected with the conduct of a trade or business in the United States.
Resident aliens generally are taxed on their worldwide income, the same as U.S. citizens.
So in this catalog of information we will cater to the nonresident alien, all their and your U.S. tax needs
What’s New for 2009
First-time homebuyer credit. Further credit has been granted for principal home purchases in the United States after 2008 and before May 1, 2010 (before July 1, 2010, if you entered into a written binding contract before May 1, 2010). The credit can only go up to $8,000 ($4,000 if you’re married and filing separately) nevertheless the credit is generally 10% of the purchase price of the home.
The credit has also been modified to allow lesser credit (limited to $6,500, $3,250 if married and filing separately) if you (and your spouse if married) were proprietors of and occupied the same principal home for any period of 5 consecutive years during the 8-year term finalizing the date you purchased your new principal home in the United States. For this credit, the replacement home must be purchased after November 6, 2009, and before May 1, 2010 (before July 1, 2010, if you signed into a written binding agreement/contract before May 1, 2010).
Keep in mind for a home that falls within the requirements of the credit and purchased in 2010 you can claim the credit on your 2009 return.
See Form 5405 (Rev. December 2009) for more information.
Portion of unemployment compensation not taxable. For those who received unemployment compensation in 2009 the first $2,400 provided in unemployment compensation is considered exempt from federal income tax. However, all compensation over $2,400 is deemed taxable.
Deduction for motor vehicle taxes. Resident aliens who made acquisitions after February 16th 2009 of wither new cars, light trucks, motor homes, and/or motorcycles they may be able to deduct state or local sales and excise taxes paid on the purchase(s), as an itemized deduction or as part of the standard deduction. For details, see the instructions for Schedule A (Form 1040).
Hope education credit. Hope credit has been increased to $2,500 additionally part of the credit is now refundable. See Publication 970, Tax Benefits for Education.
IRA deduction expanded. If your 2009 modified adjusted gross income (AGI) is less than $65,000 ($109,000 if married filing jointly or a qualifying widow(er) and you were covered by a retirement plan. You may be eligible for an IRA deduction.
Making work pay credit. , You may be eligible for a refundable tax credit if you are a resident alien who had earned income in 2009.
The credit is the lesser of:
1. 6.2% of your earned income for 2009, or
2. $400 ($800 in the case of a joint return).
For details, see Schedule M (Form 1040A or 1040) and its instructions.
Government retiree credit. If you received a pension or annuity payment in 2009 for services performed for the U.S. government or any state or local government (or any agency of one or more of these) and the service was not covered by social security. You may be eligible for a government retiree credit. For more details, see Schedule M (Form 1040A or 1040).
Exemption for certain distributions from mutual funds extended.
The exemption on the 30% tax on certain interest-related dividends and short-term capital gain dividends received from a mutual fund or other regulated investment company has been extended 2 years. It now applies to dividends for tax years of the company beginning before 2010. See Dividend Income in chapter 3.
Don’t Forget if your a Foreign national that worked in the U.S. on a temporary basis and the taxes were deducted from your check you may be entitled to money in Tax-back from the IRS. click here to start the process
Posted: January 7th, 2011 | Author: admin | Filed under: Bulletin | Tags: 1040nr, f1 visa, j1 visa, Non resident alien, physical presence test, Pub 519, substantial presence, tax guide, tax guide 3, us student visa, us tax, us tax guide, US territorial waters | No Comments »
Non resident aliens working in a US company during the summer
All nonresident alien students, with F-1 or J-1 visas who are employed by a U.S. company during the summer, are required to have federal income taxes withheld from their paychecks. This applies to all wages and other compensation paid to a nonresident alien for services performed as an employee.
These wages and compensation are:
- usually subject to graduated withholding at the same rates as resident aliens and U.S. citizens.
- subject to graduated withholding unless it is specifically excluded from the term “wages” by law, or is exempt from tax by treaty.
Nonresident aliens must follow modified instructions when completing IRS Form W-4 and should refer to IRS Publication 519, “U.S. Tax Guide for Aliens”.
Posted: January 7th, 2011 | Author: admin | Filed under: Did you know? | Tags: 1040nr, 1040nr ez, f1 visa, j1 visa, Non resident alien, physical presence test, Pub 519, substantial presence, tax guide, tax guide 3, us student visa, us tax, us tax guide | No Comments »
Which one to choose?
The basic difference between the two forms is that the 1040NR-EZ is for nonresident aliens who have a very simple tax situation. The 1040NR is used when a nonresident alien has slightly more complex sources of income.
Most nonresident aliens will file a 1040NR-EZ instead of a 1040NR. To qualify for a 1040NR-EZ you must meet the following qualifications:
- Your only U.S. source income was from wages, salaries, tips, taxable refunds of state and local income taxes, and scholarship or fellowship grants.
- You do not claim any dependents.
- You cannot be claimed as a dependent on another person’s U.S. tax return (such as your parent’s return).
- You do not claim any itemized deductions other than for state or local income tax.
- Your Taxable income is less than $100,000.00.
- If you are married and do not claim an exemption for your spouse.
- You are not claiming any tax credits.
- The only exclusion you can take is the exclusion for scholarship and fellowship grants, and the only adjustment to income you can take is the student loan interest deduction.
The only taxes you owe are:
The tax from the Tax table on pages 17 through 25, or
Unreported social security and Medicare tax from Forms 4137 or 8919.
You can use a 1040NR in most of the following cases:
- You were a nonresident alien engaged in a trade or business in the United States during 2009. You must file even if:
- You have no income from a trade or business conducted in the United States,
- You have no U.S. source income, or
- Your income is exempt from U.S. tax under a tax treaty or any section of the Internal Revenue Code.
- You are claiming dependents (residents of Canada , Mexico , Japan , Korea and students from India only) – Form 1040NR
- You received dividends or capital gains from U.S. stocks – Form 1040NR
- You received income on Form 1099 as independent contractor – Form 1040NR
- You are claiming itemized deductions such as donations to U.S. charities, professional tax preparation fees from previous years – Form 1040NR
- You are claiming un-reimbursed employee expenses (moving, travel, continuing education) – Form 1040NR
- You have additional adjustments to income – Form 1040NR
Posted: January 7th, 2011 | Author: admin | Filed under: Did you know? | Tags: 1040nr, 1040nr ez, f1 visa, j1 visa, Non resident alien, physical presence test, Pub 519, substantial presence, tax guide, tax guide 3, us student visa, us tax, us tax guide | No Comments »
J-1 visa, your probably entitled to get your tax back!
If your employer withheld these taxes from your paychecks there is a way to get your taxback. You must first request a reimbursement from your employer. If your employer is not able to do this (which happens more often than not), you should file a claim for refund with the Internal Revenue Service on Form 843, “Claim for Refund and Request for Abatement”. Along with Form 843, you must include the following:
- A copy of your Form W-2 (PDF), Wage and Tax Statement, to prove the amount of tax withheld;
- A copy of your valid entry visa;
- Copies of the pay stubs that cover the period of exemption from social security taxes if your visa status changed during the tax year;
- A copy of INS Form I-94, Arrival/Departure Record if you are still in the United States;
- A copy of Form I-20 if you have a F-1 visa;
- A copy of Form DS-2019 if you have a J-1 visa;
- Form I-766 or Form I-688B if you are engaged in optical practical training, and
- Form 8316, “Information Regarding Request for Refund of Social Security Tax”, a statement from your employer containing identical information, or a signed statement stating that you have requested a refund from the employer and have not been able to obtain one.