Form 1040-NR: U.S. Nonresident Alien Income Tax Return (2022)

What the Form Is For

Form 1040-NR is the federal income tax return for nonresident aliens—foreign individuals who don’t meet the green card test or the substantial presence test, but who earn U.S. source income or are engaged in a U.S. trade or business.

Unlike Form 1040 (for U.S. citizens and resident aliens who report worldwide income), Form 1040-NR is tailored to nonresidents and focuses mainly on:

• Effectively Connected Income (ECI)
  Income that is connected with a U.S. trade or business (wages, business profits, gains from U.S. real property, some investment income tied to your U.S. activities).
  • Reported on page 1 of Form 1040-NR
  • Taxed at graduated rates (same tax brackets as U.S. residents)
  • Deductions allowed
• Not Effectively Connected Income (Non-ECI / FDAP)
  U.S. source income not connected with a U.S. business (e.g., many dividends, interest, rents, royalties).
  • Reported on Schedule NEC
  • Generally taxed at a flat 30% on gross income
  • Rate may be reduced by an applicable tax treaty
  • No deductions allowed

You’ll also use Form 1040-NR to claim:

• Applicable itemized deductions (via Schedule A)
• Limited credits (where allowed)
• Tax treaty benefits
• Refunds when too much tax was withheld

Nonresident individuals, as well as certain nonresident estates and trusts, and personal representatives of deceased nonresident aliens, may be required to file this form.

(Links you already cited: About Form 1040-NR and the 2022 Instructions on IRS.gov.)

When You’d Use It (On Time, Late, or Amended)

On-Time Filing

Your 2022 due date depends on whether you had wages subject to U.S. withholding or an office in the U.S.:

• April 18, 2023 (15th day of the 4th month, moved from April 15 due to Emancipation Day in D.C.) if:
  • You were an employee with wages subject to U.S. income tax withholding, or
  • A nonresident alien estate or trust with an office in the United States
• June 15, 2023 (15th day of the 6th month) if:
  • You didn’t have wages subject to U.S. withholding, and
  • You didn’t maintain an office or place of business in the United States (applies to individuals and some estates/trusts)

You can request an extension to file (using Form 4868) by the original due date, but this does not extend the time to pay. Interest (and possibly penalties) begins on any unpaid tax after your original due date.

Late Filing

If you missed the deadline:

• File as soon as possible and pay as much as you can.
• Typical penalties:
  • Failure-to-file: generally 5% of unpaid tax per month (or part of a month), up to 25%
  • Failure-to-pay: generally 0.5% of unpaid tax per month, also up to 25%
• Interest accrues daily on unpaid tax from the original due date until paid.

The IRS may waive penalties for reasonable cause, but not interest.

Amended Returns

If you later discover errors (missed income, wrong deduction, overlooked treaty benefit, etc.):

• File Form 1040-X to amend your 2022 Form 1040-NR.
• You generally have:
  • 3 years from the date you filed the original return, or
  • 2 years from the date you paid the tax (whichever is later)
    to claim a refund.

You usually don’t need an amended return for simple math errors—the IRS corrects those automatically.

Key Rules

1. Residency Determination

Your tax status is based on tax law tests, not immigration labels:

• Green card test – You’re a resident if you were a lawful permanent resident at any time during the year.
• Substantial presence test – You’re a resident if you meet the day-count formula (31 days in the current year plus enough days over three years using IRS weighting rules).

If you don’t meet either test, you’re generally a nonresident alien.

Special rules: Individuals on F, J, M, or Q visas (students, teachers, trainees) can be treated as “exempt individuals” for the substantial presence test and remain nonresidents for several years, even with long physical presence.

2. Income Categories (ECI vs Non-ECI)

• Effectively Connected Income (ECI)
  • Engaging in a U.S. trade or business (services in the U.S., operating a business, elections for U.S. real property income, etc.)
  • Reported on page 1 of Form 1040-NR
  • Taxed at graduated rates
  • You can claim deductions (Schedule A and other schedules as applicable)
• Non-Effectively Connected Income (Non-ECI, FDAP)
  • U.S. source dividends, rents, royalties, interest, and certain other passive income not tied to a U.S. business
  • Reported on Schedule NEC
  • 30% flat tax on gross income (unless reduced or eliminated by treaty)
  • No deductions allowed

Correct classification is critical for applying the right rates and deductions.

3. Filing Status Limitations

As a nonresident alien:

• You cannot file as:
  • Married Filing Jointly
  • Head of Household
• You generally must file as:
  • Single, or
  • Married filing separately

Exception: If you and your spouse elect to treat you as a resident alien, you’ll file Form 1040, not 1040-NR, and you’ll both be taxed on worldwide income.

4. Standard Deduction & Credits

Most nonresident aliens:

• Cannot claim the standard deduction
• Must itemize on Schedule A (Form 1040-NR) if claiming deductions

Key exceptions and limitations:

• Indian students and business apprentices under Article 21(2) of the U.S.–India treaty may claim the standard deduction.
• Earned Income Credit is never allowed on Form 1040-NR.
• Child Tax Credit, Credit for Other Dependents, and Premium Tax Credit:
  • Very limited; often only available to residents of Canada, Mexico, South Korea, or qualifying Indian students under specific rules.

5. Tax Treaty Benefits

If your country has an income tax treaty with the U.S., you may qualify for:

• Reduced rates on dividends, interest, royalties
• Exemptions for certain scholarship, fellowship, or personal service income
• Other special rules for students, teachers, and researchers

To claim treaty benefits:

• Complete Schedule OI, item L on Form 1040-NR:
  • Name the treaty country
  • Cite the specific article
  • Indicate prior years of claims
  • Report amount of exempt income
• File Form 8833 if your treaty position overrides or modifies a normal Internal Revenue Code rule.

Step-by-Step (High Level)

Step 1: Gather Your Documents

Collect:

• Form W-2 – wages
• Forms 1042-S – U.S. income paid to nonresidents (scholarships, certain wages, investment income, etc.)
• Forms 1099 – interest, dividends, independent contractor income, etc.
• Schedule K-1 – from partnerships, if any
• Records of estimated tax payments
• Documentation of business expenses, interest, taxes, charitable contributions, etc.
• Any documents showing treaty-reduced withholding

Step 2: Confirm You Must File

You generally must file Form 1040-NR for 2022 if:

• You were a nonresident alien engaged in a U.S. trade or business; or
• You had U.S. source income where full tax wasn’t withheld; or
• You owe special taxes (AMT, certain retirement account taxes, household employment taxes, etc.); or
• You’re the representative of a deceased nonresident who would have had to file.

Certain exempt categories (some F/J/M/Q individuals with no taxable income) may have no filing requirement, though you might still file to claim a refund if tax was withheld.

Step 3: Complete Personal Information & Filing Status

At the top of Form 1040-NR:

• Enter name, address, SSN/ITIN
• Choose filing status – usually Single or Married filing separately
• List dependents only if you meet the strict rules for claiming them (and have their ID numbers)

Step 4: Complete Schedule OI (Mandatory)

Fill out Schedule OI (Other Information):

• Your country of residence
• Visa type and immigration status
• Dates and number of days in the U.S.
• Whether you claim treaty benefits and under which article
  This schedule is required for all 1040-NR filers.

Step 5: Report Effectively Connected Income (ECI)

On page 1, lines 1a–8:

• Wages from Form W-2 → line 1a
• Business/professional income → Schedule C and line 3
• Capital gains/losses from U.S. business assets → Schedule D and line 4
• Real estate or partnership income → Schedule E and line 5 or 6
• Other ECI → lines 7–8

Attach any required schedules (C, D, E, etc.).

Step 6: Report Non-Effectively Connected Income (Schedule NEC)

Use Schedule NEC for U.S. source income not connected to a U.S. business:

• Dividends, interest, rents, royalties, pensions, etc.
• Enter gross amounts in the appropriate tax-rate column:
  • 30%
  • 15% or 10% (for certain income or treaty rates)
  • “Other” rate (including 0% for fully exempt treaty income)

Schedule NEC computes tax on this income; transfer that tax to the main form where indicated.

Step 7: Deductions and Taxable Income

If you have ECI and are eligible to deduct:

• Complete Schedule A (Form 1040-NR) for itemized deductions (e.g., certain state taxes, charitable contributions, business expenses where applicable).
• Transfer the total to the main form and subtract from ECI to get taxable income.

Most nonresident aliens must itemize—no standard deduction except for specific treaty-eligible Indian students/apprentices.

Step 8: Calculate Tax and Apply Credits

• Use the tax tables or computation worksheets from the 2022 instructions to calculate tax on taxable ECI.
• Add tax from Schedule NEC on non-ECI.
• Subtract any allowed credits (e.g., limited child tax credit or foreign tax credit where applicable).

Step 9: Payments, Refund, or Balance Due

On the payments section:

• Enter federal income tax withheld from Forms W-2, 1099, and 1042-S.
• Enter estimated tax payments and any other credits/payments.
• Compare total payments to total tax:
  • If payments > tax → refund
  • If payments < tax → amount you owe

Step 10: Sign and File

• Sign and date the return (and paid preparer section, if applicable).
• Attach required forms and schedules in the order specified in the instructions:
  • W-2, 1042-S, and other withholding forms to the front
  • Schedules and Forms 8833, 1116, etc., behind the main return
• File electronically when possible (fastest), or mail to the correct IRS address if paper filing.

Common Mistakes and How to Avoid Them

1. Missing SSN/ITIN or Dependent IDs
Forgetting to include your identifying number—or those of dependents—can delay or invalidate your return. Always verify these fields.

2. Wrong Filing Status
Nonresident aliens cannot file as Married Filing Jointly or Head of Household on Form 1040-NR (barring a full-year residency election with Form 1040). Default to Single or Married filing separately as appropriate.

3. Claiming the Standard Deduction or EIC Incorrectly
Most nonresidents cannot:

• Claim the standard deduction (except certain Indian students/apprentices), or
• Claim the Earned Income Credit at all.

Child-related and premium credits also have strict, limited availability.

4. Mixing Up ECI and Non-ECI
Putting ECI on Schedule NEC or vice versa leads to wrong tax:

• ECI → page 1, taxed at graduated rates with deductions
• Non-ECI → Schedule NEC, taxed at flat rate on gross income

5. Skipping Required Schedules

• Schedule OI is mandatory.
• Schedule NEC is required if you have non-ECI—even if tax was fully withheld.

6. Incorrect or Unsupported Treaty Claims
Common errors:

• Not filling out Schedule OI, item L
• Failing to attach Form 8833 when required
• Claiming treaty exemptions without identifying the correct article and income amount

7. Not Attaching Withholding Forms
If you’re asking for a refund of withheld tax, you must attach the actual W-2, 1042-S, 1099 (with withholding), etc. No proof → possible delay or denial.

What Happens After You File

Refunds

If you overpaid:

• Check your refund status at IRS.gov/Refunds or via IRS2Go.
• Typical timing:
  • E-filed returns: usually within ~21 days
  • Paper returns: longer
  • Returns relying on 1042-S, 8805, or 8288-A withholding: can take up to 6 months due to verification.

You can choose direct deposit (often fastest) or a paper check.

If You Owe

If your tax exceeds your payments:

• Pay via IRS Direct Pay, card, EFTPS, or by check/money order.
• Interest and penalties accrue on any unpaid amount from the original due date.

If you can’t pay in full:

• You may qualify for a short-term payment plan or a longer installment agreement (with setup fees and ongoing interest/penalties).

IRS Review, Notices, and Audits

The IRS will:

• Match your return with W-2, 1099, 1042-S and other forms filed by payers.
• Correct simple math errors automatically.
• Send you notices by mail if:
  • Information is missing
  • Treaty claims need support
  • Residency/treaty positions are unclear
  • There are mismatches with third-party data

Always respond by the deadline and keep copies of all correspondence.

In some cases, a return may be selected for audit. If so, you’ll need to provide records supporting your income, deductions, and treaty claims.

Recordkeeping and Future Years

Keep for at least three years:

• Copies of filed returns
• All supporting statements and forms
• IRS notices

These records are important if you:

• Need to amend a prior year
• Are later audited
• Change to resident status and must show prior nonresident treatment
• Apply for immigration/visa benefits where tax compliance is reviewed

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