Resident Aliens for Tax Purposes

Federal

Resident aliens for tax purposes follow the same guidelines and use the same forms as U.S. citizens.

State

The guidelines at the Michigan Department of Treasury web site state that you are required to file a State of Michigan tax form if you file a federal return or your income exceeds your Michigan exemption allowance ($4,750 per person). Even if you are not required to file a State of Michigan tax form, you may want to do so anyway if too much tax was withheld from your income and you are due a refund. If you do not file a Michigan tax form, the State of Michigan will keep your refund.

Individuals who are considered residents for federal tax purposes may still be considered nonresidents by the State of Michigan. If you fall into this category you then must file a MI 1040 plus a MI Schedule NR and a MI Schedule 1. For more information about determining your State of Michigan tax residency status and for information about filing as a Michigan non-resident, please review these handouts from the March 2021 Michigan Tax Workshop. 

March 2021 Michigan Tax Workshop Handouts 

Tax Treaties with Other Countries

Under certain limited circumstances, international students and scholars from tax treaty countries may be eligible to claim treaty benefits even though they are considered resident aliens for U.S. tax purposes. If you are a resident alien for U.S. tax purposes AND are eligible to claim an income tax treaty exemption, follow the steps below. Please also review the “Resources” section below to learn when resident aliens for U.S. tax purposes can claim tax treaty benefits.

  1. Go to www.irs.gov to obtain Form 1040 (and its instructions), Schedule 1, and Schedule OI.  Please note that depending on your situation, there may be additional Schedules that also apply to you;
  2. Complete all of the income lines on Form 1040, as well as any other Schedules, as applicable to you;
  3. On Schedule 1, Line 8 (Other Income), write "U.S.-{country} tax treaty, Article {article number}” on the dotted line.  Also on Schedule 1, Line 8, enter the total amount you wish to claim as a tax treaty exemption as a negative number. Then, in effect, the amount of tax treaty exemption will be subtracted when you enter a total on Schedule 1, Line 9;
  4. Enter the amount from Schedule 1, Line 9, onto your Form 1040, Line 8;
  5. On Schedule OI, complete your name and Social Security Number, write "Resident Alien with Tax Treaty Exemption” across the top of the page, and complete ONLY Section L;
  6. Attach Schedule 1 and Schedule OI to the back of your Form 1040. If you received a Form 1042-S or Form W-2, attach the applicable copies to the front, bottom section of Form 1040;
  7. Regardless of where you live, MAIL your Form 1040, Schedules and other applicable documents to:
    IF NO Additional Tax is Due: OR IF Additional Tax is Due:
    Department of the Treasury
    Austin, TX 73301-0215
    (no street address is needed)
    Internal Revenue Service
    P.O. Box 1303
    Charlotte, NC 28201-1303

Resources:

Internet Resources: Claiming treaty benefits as a tax resident

The information contained in this web site is not a substitute for advice obtained from the Internal Revenue Service or a qualified tax professional.