Subject: Five year limit and Form 8843

From: [email-masked]
Date: Thu, 10 Mar 94 15:53:18 CST

It is the discussion regarding part of D.B. Zhu's question:

Why can international student be a non-resident alien taxpayer for only 
5 years?

This 5-year saying is from IRS rules. Every year you file tax return 
form, you ought to check your filing status by going through the so 
called "Green card test" and "Substantial Presence test." 

183 days
--------
When you do the "Substantial Presence Test", you count days of present 
in the States. You will be considered as a resident alien if your 
total days of present in the States are at least 183 days. (not complete 
definition, for accuracy, see Pub. 519)

Exempt individuals
------------------
The rules state that a student with "F,J, or M" visa is considered as 
"exempt individual" for this day-counting purposes. The days that you  
are in the States as an "exempt indiviual" are not counted when you do 
the "substantial presence test." 

That's why you can still be a non-resident alien taxpayer 
even though you actually domiciled in US for the entire year, because 
you do not meet the "Substantila Presence Test" after excluded the days as 
"exempt individual."

Limitation
----------
The 5-year limit comes from here. The rule says that "You will not be 
an exempt individual if you have been as a ..., or student for any part 
of more than 5 calendar years unless you establish to the satisfaction 
of the IRS district director that you ..." (from page 5, Pub. 519, 
Chapter 1)

If your stay as "exempt individual" are invalid, then you will certainly 
meet the "Substantial Presence Test" and become a resident alien. The 
result is that you cannot cite Sino-US treaty anymore.

Caution
-------
You will notice that there is a line on Form 8843 asking whether you 
have been a student for more than five years. Now you should know what 
IRS is looking for from this information. Be alert and don't be trapped.

YSZ

For Zhu's info: I found that the notice date printed on my approval 
letter is 9/28/93 and the starting date printed on my green card 
is XXX XXX 930927 XXX XXX... This indicates that the first day of PR is 
generally determined by the approval date. No comment about how you 
should file.