On February 2, 2022, the Internal Revenue Service (IRS) provided taxpayers with a crucial resource by posting Publication 519, the “U.S. Tax Guide for Aliens,” tailored for use in preparing returns for the tax year 2021. This comprehensive guide serves as an indispensable reference for nonresident aliens and foreign individuals navigating the intricacies of U.S. tax laws and regulations.
A notable highlight emphasized within Publication 519 pertains to the impact of the COVID-19 pandemic on tax residency determinations for the tax year 2021. Specifically, individuals or “humans,” as you’ve aptly noted, are unable to claim the COVID-19 medical condition travel exception to exclude days present in the United States for purposes of calculating the substantial presence test for the 2021 tax year.
It’s crucial for taxpayers to be aware that while the COVID-19 travel exception may not apply to days present in the United States in 2021, days present in the previous tax year, 2020, could still influence the calculation of the substantial presence test for the 2021 tax year. This underscores the importance of accurately tracking and documenting days spent in the United States, as well as understanding the implications for tax residency status and potential tax obligations.
Publication 519 provides detailed guidance on how to determine tax residency status, including the substantial presence test, and offers insights into various tax considerations for nonresident aliens and foreign individuals. By consulting this authoritative resource, taxpayers can ensure compliance with U.S. tax laws and make informed decisions regarding their tax obligations.
For more information on this exception for the 2020 tax year, check out the IRS FAQs for Nonresident Alien Individuals and Non-U.S. Businesses with Employees or Agents Impacted by COVID-19 Emergency Travel Disruptions:
Also, check out the DRAFT Publication 519 here: