The Closer Connection rule exempts snowbirds (Canadians who winter in the US) and any non-citizen (including former ones) who spend up to 182 days in a year in the US from being considered US tax residents, though ironically it does not apply to US citizens living outside the US. John Richardson examines Closer Connection in this article. (reposted with permission)
Question For Americans Abroad:
Did you know that people who are NOT U.S. citizens or Green Card holders can live in the USA for 182 each year, meet the requirements to to be a U.S. “tax resident” but actually file a “closer connection to another country form” to NOT be treated as a U.S. tax resident? They will avoid U.S. taxation, penalties and reporting!!
Do you like what you just read? Did you know that you can renounce your U.S. citizenship (outside the United States) and then spend up to 182 days in a year in the United States (assuming you meet the immigration requirements) and not be taxable by the United States or have to file forms (including FBAR) as long as you have a “closer connection” to another country?
What about immigration considerations? Can I legally enter and stay in the United States?
The immigration requirements for entry and stay in the United States depend on a number of factors. That said, here are two groups of people who are likely eligible to spend up to six months a year in the United States:
1. Canadian citizens and from the Canadian perspective
There may be other options.
Bottom line: To put it simply, non-U.S. citizens can spend loads of time in the USA (for a number of reasons) and be completely exempt from the requirements that make the lives of Americans abroad a “living hell”!
Americans abroad are fully aware of U.S. “citizenship taxation”. The “closer connection” exemption is an example of “citizenship non-taxation”.
Read on!! – it’s all about having a “closer connection” (a form of “citizenship non-taxation”) to another country!
