Filing Treaty-Based Nonresident Alien Tax Return While Applying for Adjustment of Status

[Tony_Chocolonely 2]

This may be a bit of a technical matter but here are the facts:

• Married couple; both husband and wife were Polish citizens during the year 202X
• Both husband and wife lived a majority of the year 202X in the U.S.
• Both husband and wife applied for an adjustment of status during the year 202X; application was still pending and unprocessed by USCIS as of December 31, 202X (but notification of filing was issued during the year 202X)
• Both husband and wife met the substantial presence test during the year 202X and would normally be required to file Forms 1040 as U.S. tax residents for the year 202X
• However, their circumstances during 202X were such that, under the Article 4 tie-breaker rules of the US-Poland income tax treaty, both husband and wife were still deemed to be tax residents of Poland, not the U.S. for the year 202X

The above being so, the questions are:

1. Has anyone with similar circumstances taken a treaty-based return position by filing Form 8833 "Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b)" to file taxes in the U.S. as a nonresident (i.e. Form 1040-NR) during the year their adjustment of status application was still in-process?
2. If so, was the nonresident alien return and the treaty-based return position accepted or rejected by the IRS?
3. Did filing in the U.S. as nonresident aliens using that treaty-based return position prejudice their application for an adjustment of status or otherwise negatively impact the outcome of same?
4. Is anyone aware of a prohibition in U.S. tax or immigration laws, regulations, or other authorities against taking a treaty-based return position to be treated as a nonresident alien for U.S. tax purposes while their application for an adjustment of status is still in-process?

Thank you anyone for any advice and input you may have on this matter.

[Rocio0010 5,562]

1 hour ago, Tony_Chocolonely said:

This may be a bit of a technical matter but here are the facts:

• Married couple; both husband and wife were Polish citizens during the year 202X
• Both husband and wife lived a majority of the year 202X in the U.S.
• Both husband and wife applied for an adjustment of status during the year 202X; application was still pending and unprocessed by USCIS as of December 31, 202X (but notification of filing was issued during the year 202X)
• Both husband and wife met the substantial presence test during the year 202X and would normally be required to file Forms 1040 as U.S. tax residents for the year 202X
• However, their circumstances during 202X were such that, under the Article 4 tie-breaker rules of the US-Poland income tax treaty, both husband and wife were still deemed to be tax residents of Poland, not the U.S. for the year 202X

The above being so, the questions are:

1. Has anyone with similar circumstances taken a treaty-based return position by filing Form 8833 "Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b)" to file taxes in the U.S. as a nonresident (i.e. Form 1040-NR) during the year their adjustment of status application was still in-process?
2. If so, was the nonresident alien return and the treaty-based return position accepted or rejected by the IRS?
3. Did filing in the U.S. as nonresident aliens using that treaty-based return position prejudice their application for an adjustment of status or otherwise negatively impact the outcome of same?
4. Is anyone aware of a prohibition in U.S. tax or immigration laws, regulations, or other authorities against taking a treaty-based return position to be treated as a nonresident alien for U.S. tax purposes while their application for an adjustment of status is still in-process?

Thank you anyone for any advice and input you may have on this matter.

Why the "X" at the end of each year?

[Tony_Chocolonely 2]

18 minutes ago, Rocio0010 said:

Why the "X" at the end of each year?

It is meant to denote an example year. In other words, 202X could be any single year in the 2020s (i.e. 2020, 2021, 2022, etc.).

[Rocio0010 5,562]

1 hour ago, Tony_Chocolonely said:

It is meant to denote an example year. In other words, 202X could be any single year in the 2020s (i.e. 2020, 2021, 2022, etc.).

Ok. 

Are you aware of FBAR filing requirement?

[Tony_Chocolonely 2]

1 minute ago, Rocio0010 said:

Are you aware of FBAR filing requirement?

Yes I am but my questions are unrelated to FBAR and FATCA.

[Rocio0010 5,562]

4 minutes ago, Tony_Chocolonely said:

Yes I am but my questions are unrelated to FBAR and FATCA.

I was just trying to help. Many people are unaware. Good luck.

[powerpuff 5,892]

~ Topic moved from Diversity Lottery Visas to Tax & Finances ~

[Wuozopo 4,285]

@Tony_Chocolonely
 

Did either of you earn income in 202X and did you pay income tax to Poland?

[Tony_Chocolonely 2]

1 hour ago, Rocio0010 said:

Good luck.

Thank you.

[Tony_Chocolonely 2]

4 minutes ago, Wuozopo said:

Did either of you earn income in 202X and did you pay income tax to Poland?

Assume "yes" to both questions for the purposes of this scenario.

[chancecody 123]

I like your name Tony_Chocolonely 😀 Did you consult a tax professional that specializes in this?

 

From my perspective, since you are going through AOS and you demonstrated that you meet the substantial presence test, I'd like you to review the Closer Connection Exception as it is on the same side of the coin of as the Treaty Tie Breaker rule. Just my opinion, it is better to file as an alien resident as you meet the test and it will less likely to put a damper on your AOS. Consult a professional. Good luck to you!

 

You cannot claim you have a closer connection to a foreign country if either of the following applies:

You personally applied, or took other steps during the year, to change your status to that of a Lawful Permanent Resident, or
You had an application pending for adjustment of status to Lawful Permanent Resident during the year.