Guiding clients on U.S. residency status – the distinction between resident alien and nonresident alien – is crucial for determining tax liability. Resident aliens are taxed like U.S. citizens, on their worldwide income, while nonresident aliens are generally subject to U.S. taxation only on income that is effectively connected with the conduct of a U.S. trade or business and on specified types of U.S. source income.
Understanding the conditions that determine U.S. residency status can be confusing if you aren’t familiar with the myriad compliance issues at stake. Residency tests, exemptions, filing requirements, and other residency considerations are all on the table. Your clients should understand these issues so that they can comply with the law. Issues like these highlight the need for practical resources and tools to help you engage with your clients in all of life’s diverse scenarios.
Trusted information only gets you so far if you can’t easily put your knowledge to work in regular client communication. Understanding which of your clients this (or any other) issue affects is the first step to providing premier client service when tax planning season rolls around.
Help clients understand complex rules
CCH Axcess iQ leverages the data housed in your CCH Axcess Tax returns. It jumpstarts the process of reaching out to clients who need to understand the implications of their U.S. residency status. For this issue, an in-depth article provides tests for determining the taxpayer’s status as a resident or nonresident. It also provides cautionary and compliance tips to help navigate the complex rules. In addition, it includes a client letter that summarizes the issue for your clients. With these tools, you can engage with clients as quickly and efficiently as possible.
Learn how to put your client data to work for you and capitalize on this and other tax planning opportunities. See the full potential of the predictive intelligence provided by CCH Axcess iQ. Contact a Solutions Consultant or register for a demonstration today.