What Is a Resident Alien?
A resident alien is a foreign-born United States resident who is not a U.S. citizen. A resident alien is also known as a permanent resident or a lawful permanent resident, which means they are considered an immigrant who has been legally and lawfully recorded as a resident of the country. A resident alien must have a green card or pass a substantial presence test.
Understanding Resident Alien Status
A resident alien is a foreign person who is a permanent resident of the country in which he or she resides but does not have citizenship. To fall under this classification in the United States, a person needs to either have a current green card or have had one in the previous calendar year.
- A resident alien is a foreign-born, non-U.S. citizen who lives in the U.S.
- Resident aliens must have a green card or pass a substantial presence test.
- In general, a resident alien is subject to the same taxes as a U.S. citizen.
People can also fall under the U.S. classification of resident alien if they pass the substantial presence test. In order to do so, they must have been in the United States for more than 31 days during the current year, along with having been in the United States for at least 183 days over a three-year period, including the current year.
According to the United States Citizenship and Immigration Services (USCIS), there are three types of resident alien:
- Permanent resident: This is someone who has been given the lawful and legal right by the government to live in the United States.
- Conditional resident: This person receives a two-year green card, which is usually given to people who have applied for residency based on marriage or because they are entrepreneurs. A person must apply to have the conditions removed 90 days before the green card expires, or else the permanent resident status will be removed.
- Returning resident: This is someone who has been outside the U.S. and is returning to the country. This person, also known as a "special immigrant," and must apply for readmission if he is outside the U.S. for more than 180 days.
The main issue with resident aliens is that of tax law. For example, a resident alien can use foreign tax credits, whereas a non-resident cannot. However, in general, a resident alien is subject to the same taxes as a U.S. citizen, while a non-resident alien only pays tax on domestic income that is generated within the United States, not including capital gains.
The U.S. Department of Homeland Security recorded admitting 1.1 million new permanent residents in the country in 2017, the most recent figures available.
Resident aliens are required to report worldwide income from sources both within and outside the United States. Income is reported using Form 1040. Non-resident aliens, on the other hand, report domestic income using Form 1040NR or Form 1040NR-EZ.
Example of a Resident Alien
Often times, resident alien status provides positive benefits for the United States and for those seeking the status. For example, Cristela Alonzo, an actress, comedian, and contributor to Time Magazine, had a mother and brother who were both granted resident alien status. Her mother, a single parent, immigrated from Mexico with her eldest son and tried for years to obtain resident alien status.
Resident and non-resident aliens have different tax filing advantages and disadvantages.
After numerous attempts, both Alonzo's mother and her older brother received the desired status. Then, Alonzo's mother had three natural-born citizens, bringing the total number of her children to four. As of today, each of the four kids hold respectable jobs and are contributing members of society, helping the U.S. economy. This family would not have been able to add value to the American economy and realize a better life had Alonzo's mother not been granted resident alien status.
It is possible to be considered exempt from resident alien status, in which case a person does not need to prove compliance with the green card test or the substantial presence test. Situations in which a person is present in the United States on government-related issues or when a student or teacher is temporarily present in the United States are both examples of exemptions.
These exempt aliens can, depending on the situation, file for an adjustment of status, a process that allows them to remain the country and apply to become a permanent resident with resident alien status.