Form 1040-NR: U.S. Nonresident Alien Income Tax Return (2023)

What Form 1040-NR Is For

Form 1040-NR is the tax return used by nonresident aliens—foreign individuals, estates, and trusts—to report income from U.S. sources to the Internal Revenue Service. If you're not a U.S. citizen and you don't meet the tests to be considered a resident alien (such as holding a green card or passing the substantial presence test), you're likely a nonresident alien. This form helps you calculate and pay tax on income you earned in or from the United States.

The form handles two main categories of income. First, income that's ""effectively connected"" with a U.S. trade or business—think wages from a U.S. employer, profits from operating a business in the States, or rental income from U.S. property you actively manage. This income is generally taxed at graduated rates, similar to how U.S. citizens are taxed. Second, income that's not effectively connected—like dividends from U.S. stocks, interest payments, or royalties—which is typically taxed at a flat 30% rate unless a tax treaty between the U.S. and your home country provides a lower rate or exemption.

You must file Form 1040-NR if you engaged in any trade or business in the U.S. during the year, even if you had no income, no U.S. source income, or your income is exempt under a treaty. You also need to file if you had U.S. source income that wasn't fully withheld at the source, or if you owe special taxes like self-employment tax or alternative minimum tax. The form works alongside several schedules: Schedule OI (Other Information), which every filer must complete; Schedule NEC (Tax on Income Not Effectively Connected), for investment income and similar sources; and potentially Schedules 1, 2, and 3 from the regular Form 1040 for additional income, taxes, and credits. IRS.gov

When You’d Use Form 1040-NR (Filing Late or Amended Returns)

Regular Deadlines

The deadline for filing Form 1040-NR depends on your employment situation. If you were an employee who received wages subject to U.S. income tax withholding, your return is due on the 15th day of the fourth month after your tax year ends—April 15, 2024, for calendar year 2023 (April 17 for residents of Maine and Massachusetts due to state holidays). If you didn't receive wages as an employee subject to withholding, you get extra time: your return is due on the 15th day of the sixth month after your tax year ends—June 17, 2024, for calendar year 2023. For nonresident alien estates and trusts, the deadline is the fourth or sixth month depending on whether the estate or trust maintains an office in the United States.

Filing an Extension

If you can't meet your deadline, you can request an extension of time to file by submitting the appropriate form before your original deadline. However, an extension to file is not an extension to pay—you still need to estimate and pay any tax you owe by the original deadline to avoid interest and penalties. The instructions reference the standard procedures outlined in the Instructions for Form 1040 for requesting extensions.

Late Returns

If you file after your deadline without having requested an extension, you may face interest charges on unpaid tax and potential late-filing penalties. The IRS calculates these penalties based on how late your return is and how much you owe. Even if you're filing late, submit your return as soon as possible—the penalties stop accruing once you file, and you won't receive any refund you're entitled to until you file.

Amended Returns

To correct a mistake or change information on a Form 1040-NR you've already filed, use Form 1040-X (Amended U.S. Individual Income Tax Return). As of tax year 2021, you can file Form 1040-X electronically using tax software to amend your Form 1040-NR, making the process faster and more convenient. After you submit an amended return, it typically takes about three weeks to appear in the IRS system and up to 16 weeks to process. You can track the status of your amended return by visiting IRS.gov/WMAR. IRS.gov

Key Rules or Details for 2023

Several important rules distinguish Form 1040-NR from the standard Form 1040 that U.S. citizens and resident aliens use:

Filing Status Limitations

You cannot file as ""Married filing jointly"" or ""Head of household."" Even if you're married, you'll typically select ""Married filing separately"" unless you qualify as a ""Qualifying surviving spouse"" under very specific circumstances.

No Standard Deduction

Nonresident aliens generally cannot claim the standard deduction that U.S. residents receive automatically. There's a limited exception for students and business apprentices from India who qualify under Article 21(2) of the U.S.-India tax treaty.

Limited Tax Credits

Most nonresident aliens cannot claim common credits like the earned income credit, education credits, or the full child tax credit. However, residents of Canada, Mexico, South Korea, and to some extent India, may qualify for certain credits including the child tax credit and premium tax credit for dependents. Tax treaties may also provide additional benefits.

Tax Identification Required

You must have a Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) to file. Make sure you enter your identifying number and your dependents' identification numbers in the appropriate places on the form—failing to do so is one of the most common filing mistakes.

Resident vs. Nonresident Status

Your status is determined by either the green card test (lawful permanent residents are resident aliens) or the substantial presence test (counting days physically present in the U.S. over a three-year period). If you don't pass either test, you're a nonresident alien. Some individuals may have dual status—part of the year as a resident, part as a nonresident—which requires special reporting.

Treaty Benefits

If your home country has an income tax treaty with the United States, you may be eligible for reduced tax rates or exemptions on certain types of income. To claim treaty benefits, you must properly disclose them on Schedule OI and may need to attach Form 8833 (Treaty-Based Return Position Disclosure). IRS.gov

Step-by-Step (High Level)

1. Determine Your Status

Confirm you're a nonresident alien by checking that you don't have a green card and don't meet the substantial presence test (generally, being physically present in the U.S. for at least 183 days using a weighted formula over three years).

2. Gather Your Documents

Collect all income documents: Form W-2 for wages, Form 1042-S for income with tax withheld at source, Form 1099 for various types of investment income, and any other records of U.S. source income. Also gather receipts for any deductions you plan to claim on effectively connected income.

3. Complete Schedule OI First

Every Form 1040-NR filer must complete Schedule OI (Other Information). This schedule asks about your visa type, dates in the U.S., tax treaty benefits you're claiming, and other essential background information.

4. Report Effectively Connected Income

On page 1 of Form 1040-NR, report income that's effectively connected with a U.S. trade or business—wages, business income, rental income from property you actively manage, and capital gains from business property. This section looks similar to Form 1040 used by U.S. residents.

5. Complete Schedule NEC (If Applicable)

If you received U.S. source income that's not effectively connected with a trade or business—such as dividends, interest, or royalties—complete Schedule NEC. This schedule calculates the tax on this income, typically at a flat 30% rate unless reduced by treaty.

6. Claim Deductions and Credits

For effectively connected income, you can claim itemized deductions using Schedule A (Form 1040-NR)—note this is different from Schedule A for Form 1040. You may also be eligible for limited credits depending on your country of residence and specific circumstances.

7. Calculate Your Tax

Add up your tax from effectively connected income and tax from Schedule NEC. Compare this to tax already withheld (shown on your W-2, 1042-S, and 1099 forms) and any estimated tax payments you made during the year.

8. Complete Payment or Refund Information

If you owe additional tax, make arrangements to pay by the filing deadline. If you're due a refund, provide direct deposit information for the fastest processing, or request a check.

9. Sign and File

Sign and date your return. You can e-file for faster processing or mail a paper return to the address specified in the instructions (different addresses apply depending on whether you're including a payment). IRS.gov

Common Mistakes and How to Avoid Them

Missing or Incorrect Identification Numbers

Failing to enter your SSN or ITIN, or your dependents' identification numbers, is one of the most frequent errors. Double-check that all identification numbers are complete and accurate before filing.

Wrong Filing Status

Remember, you cannot select ""Married filing jointly"" or ""Head of household"" as a nonresident alien. If you're married, you'll almost always use ""Married filing separately."" Selecting an incorrect status can invalidate credits and deductions.

Claiming Ineligible Credits

Many filers mistakenly claim credits that aren't available to nonresident aliens, such as the earned income credit, education credits, or the child tax credit (unless you're a resident of Canada, Mexico, South Korea, or in limited cases, India). Review credit eligibility carefully before claiming them.

Using the Wrong Schedule A

There are two different Schedule A forms—one for Form 1040 and one specifically for Form 1040-NR. Make sure you use Schedule A (Form 1040-NR) with your nonresident return, not the version designed for residents.

Forgetting Required Attachments

You must attach Forms W-2, 1042-S, 1099-R (if tax was withheld), and other relevant tax documents to your return. Missing documents can delay processing and your refund. Attach them to the left margin of page 1.

Incorrectly Reporting Treaty-Exempt Income

If you're claiming a tax treaty benefit, you must still report the income on your return and properly indicate the treaty exemption on Schedule OI. You may also need to attach Form 8833 for certain treaty positions. Failing to disclose treaty benefits properly can result in denial of those benefits.

Not Distinguishing Between Income Types

Mixing up effectively connected income and not effectively connected income leads to miscalculation of your tax. Effectively connected income goes on page 1; not effectively connected income belongs on Schedule NEC. Each type is taxed differently, so correct classification is essential.

To avoid these mistakes, review the instructions carefully, use tax software that supports Form 1040-NR if possible, and consider consulting a tax professional familiar with nonresident alien taxation if your situation is complex. IRS.gov

What Happens After You File

Processing Your Return

Once the IRS receives your return, they'll process it to verify the information and calculate your final tax liability or refund. If you e-filed, you'll receive an electronic acknowledgment that the IRS has accepted your return, typically within 24-48 hours. Paper returns take longer to process.

Receiving Your Refund

If you're owed a refund, the fastest way to receive it is through direct deposit into your bank account—eight out of ten taxpayers choose this option. You can check your refund status using the ""Where's My Refund?"" tool at IRS.gov/Refunds or through the IRS2Go mobile app. Most refunds are issued within 21 days of e-filing. However, if your refund involves tax withheld on Form 1042-S, Form 8805, or Form 8288-A, allow up to six months for processing—these require additional review time.

Making a Payment

If you owe tax, payment must be made in U.S. dollars (cryptocurrency and other digital assets are not accepted). You can pay online, by phone, or through your mobile device. Visit IRS.gov/Payments to see all available options. If you don't pay by the deadline, you'll owe interest and potentially penalties on the unpaid amount.

IRS Correspondence

The IRS may contact you if they need additional information, find a discrepancy, or need clarification about something on your return. Always respond promptly to IRS letters to avoid delays or additional penalties. Keep copies of your return and all supporting documents for at least three years.

Audit Selection

Like all tax returns, Form 1040-NR may be selected for audit. The IRS uses various methods to identify returns for examination, and being selected doesn't necessarily mean you made a mistake. If you're audited, respond professionally and provide requested documentation. You have rights throughout the audit process, outlined in the Taxpayer Bill of Rights.

Amended Return Status

If you filed an amended return using Form 1040-X, you can track its status at IRS.gov/WMAR. Processing typically takes up to 16 weeks, though complex amendments may take longer. IRS.gov

FAQs

Do I have to file Form 1040-NR if I had no income from the U.S.?

If you engaged in a trade or business in the United States at any time during the year, you must file Form 1040-NR even if you had no income, no U.S. source income, or your income is entirely exempt under a tax treaty. However, if you meet certain exemptions—for example, you're a student on an F, J, M, or Q visa with no taxable income, or you're a partner in a partnership not engaged in U.S. trade or business—you may not need to file.

Can I claim my spouse or children as dependents?

You can claim dependents on Form 1040-NR, but your ability to receive tax benefits for them is limited. Residents of Canada, Mexico, and South Korea can claim the child tax credit and other dependent-related benefits. Residents of India have limited access to some benefits. Most other nonresident aliens can list dependents but receive no tax benefit from them. Each dependent must have a valid SSN, ITIN, or ATIN.

What if I qualify for a tax treaty benefit?

If your country has an income tax treaty with the United States, you may be eligible for reduced tax rates or exemptions on certain types of income. To claim treaty benefits, you must be a resident of the treaty country for tax purposes and not have a permanent establishment in the U.S. Report the treaty benefit on Schedule OI, and attach Form 8833 if required by the instructions. Even treaty-exempt income must be reported on your return.

How do I know if my income is effectively connected or not?

Income is effectively connected if it's from a U.S. trade or business you're actively engaged in, such as wages from a U.S. employer, business profits, or rental income from property you actively manage. Income that's not effectively connected includes passive investment income like dividends from stocks, interest from bonds, or royalties—income where you're not actively conducting business. The distinction matters because they're taxed differently: effectively connected income is taxed at graduated rates, while not effectively connected income is typically taxed at a flat 30% rate.

Can I e-file my Form 1040-NR?

Yes, you can electronically file Form 1040-NR using tax software. E-filing is faster, more secure, and results in quicker refunds if you're owed money. The IRS has also made electronic filing of amended returns (Form 1040-X) available for Form 1040-NR starting with tax year 2021. Most paid tax preparers are required to e-file your return.

What should I do if social security or Medicare taxes were withheld from my wages in error?

Foreign students and exchange visitors on F-1, J-1, M-1, or Q visas are generally exempt from social security and Medicare taxes. If these taxes were withheld from your wages in error, you may file Form 843 (Claim for Refund and Request for Abatement) to request a refund. Don't include this refund request on your Form 1040-NR—it's a separate process.

Where can I get help if I have questions?

The IRS offers numerous free resources at IRS.gov, including Publication 519 (U.S. Tax Guide for Aliens), which provides comprehensive information for nonresident aliens. You can also contact the Taxpayer Advocate Service at 877-777-4778 if you're experiencing financial hardship or haven't been able to resolve an issue with the IRS. Low Income Taxpayer Clinics (LITCs) provide free or low-cost help to qualifying taxpayers and can represent you before the IRS. IRS.gov

This summary is based on official IRS guidance for tax year 2023. Tax laws change periodically, so always refer to the current year's instructions and IRS.gov for the most up-to-date information.

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