Determining Resident/Nonresident Alien Status Two-country closer connection exception.18 An alien can establish a closer connection to two foreign countries (but no more than two) during the current year by meeting all the following conditions: 1. The alien maintains a tax home beginning on the first day of the current year in one foreign country, but changes to a tax home in another foreign country and maintains that tax home for the remainder of the current year. 2. The alien has a closer connection to each foreign country than to the U.S. for the period in which the alien maintained a tax home in that foreign country. 3. The alien is subject to tax as a resident by either foreign country for all of the current tax year, or by both foreign countries for the period in which the alien maintained a tax home in each country. Form 8840 or similar statement required. An alien who otherwise meets the substantial presence test must file with his or her personal income tax return Form 8840, Closer Connection Exception Statement for Aliens, or a similar statement to explain why he or she meets the closer connection exception. If the form or similar statement is not filed, the person cannot claim the closer connection exception and must include all days of U.S. presence for purposes of the substantial presence test. Seeking permanent resident status change voids exception.19 The closer connection exception does not apply for any year during which the alien has personally applied or taken other steps to change his or her immigration status to that of U.S. permanent resident or has an application pending for adjustment to permanent resident status. DUAL STATUS ALIENS An alien may be considered a resident alien and a nonresident alien in the same year, a situation normally occurring in the year of arrival in and departure from the U.S. The U.S. residency starting and ending dates depend on whether the person qualifies as a U.S. resident under the lawful permanent resident test or the substantial presence test, or both. First year of residency20 For an alien who meets only the substantial presence test for the calendar year, the U.S. residency starting date is generally the first day the alien is physically present in the U.S. For an alien who meets only the lawful permanent resident test for the calendar year, the U.S. residency starting date is the first day the person is physically present in the U.S. as a 18. IRS Reg. §301.7701(b)-2(e). 19. IRS Reg. §301.7701(b)-2(f). 20. IRS Reg. §301.7701(b)-4(a). 1-7