Green card holders living abroad: US tax until status ends

What this covers

The green card test makes a lawful permanent resident a US resident alien for tax purposes, taxed on worldwide income like a citizen. Immigration status and tax status are linked but not identical: immigration authorities look at whether you have abandoned your permanent residence, while the IRS looks at whether status has been formally ended. The gap between the two is where most problems for green card holders abroad start.

Start from the green card test

Publication 519 says you are a resident for tax purposes if you are a lawful permanent resident at any time during the calendar year, and that you keep resident status under this test unless it is taken away or is administratively or judicially determined to have been abandoned. Living abroad does not by itself change that. The United States country record summarizes both residence tests.

As resident aliens, green card holders generally face the same duties as citizens abroad: tax on worldwide income and foreign account reports. See US citizens abroad and FBAR vs Form 8938. People who are not green card holders are tested under the substantial presence test instead.

Know how status is abandoned for tax purposes

Publication 519 says an abandonment can be started by you, by USCIS or by a US consular officer. If you start it, your status counts as abandoned when you file Form I-407, Record of Abandonment of Lawful Permanent Resident Status, or a letter stating your intent to abandon, with your green card attached, with USCIS or a consular officer. If you mail it, the IRS says to use certified mail with return receipt and keep proof.

The IRS adds a caution: until you have proof the filing was received, you remain a resident alien for tax purposes even if USCIS would not recognize your green card because it is more than 10 years old or because you have been absent for a period of time. If USCIS or a consular officer starts the process, abandonment takes effect when a final administrative order is issued, or a final judicial order if you appeal.

USCIS describes Form I-407 as a voluntary notice. It says the standard method is mailing the form to the address on its page, that a Customs and Border Protection officer may accept it at a port of entry, and that embassies or consulates accept it in person only in rare cases. USCIS also says it shares your name and filing date with the IRS and warns that there may be significant income tax consequences, including possible expatriation tax. There is a filing fee set in the USCIS fee schedule.

Plan long trips with a reentry permit in mind

USCIS says that an absence of more than a year is a general guide for abandonment, but status can also be found abandoned after shorter trips if you did not intend the United States to be your permanent home. Among the factors it lists are US family and community ties, employment, a US address, bank accounts and filing US income taxes as a resident.

A reentry permit, requested on Form I-131 before you leave, lets you seek admission while it is valid without needing a returning resident visa, though you must still be found admissible. USCIS says that if you stay outside the United States for more than 2 years, a reentry permit granted before you left will have expired, and it suggests considering an SB-1 returning resident visa at a US embassy or consulate.

The tax side runs the other way. Publication 519 says a lawful permanent resident who is required to file as a resident and fails to do so may be regarded under immigration law as having abandoned status. A long absence does not end tax residence on its own, but filing as a nonresident can raise immigration questions.

Count your years against the 8-of-15 long-term resident rule

The Form 8854 instructions say you are a long-term resident if you were a lawful permanent resident in at least 8 of the last 15 tax years ending with the year your status ends. Years in which you were treated as a resident of a treaty country, without waiving treaty benefits, do not count.

A long-term resident who ends status is treated like a citizen who renounces. The covered expatriate tests apply, the mark-to-market exit tax can apply, and an initial Form 8854 is due for the year status ends. See renouncing US citizenship and the exit tax for the tests and amounts.

The instructions list the events that end long-term residency for this purpose: voluntarily abandoning status by filing Form I-407 with a consular or immigration officer, a final order of abandonment, a final removal order, or starting to be treated as a resident of a treaty country under the applicable procedures.

Weigh the treaty tie-breaker risk before claiming it

Many income tax treaties have a tie-breaker rule for people resident in both countries. Publication 519 says that if you are treated as a resident of a foreign country under a treaty, you are treated as a nonresident alien in figuring your US income tax, and you must file Form 1040-NR with Form 8833 attached.

Publication 519 also notes that being treated as a nonresident under a treaty tie-breaker can, in some cases, trigger the section 877A expatriation tax. The IRS expatriation page says a long-term resident ceases to be a lawful permanent resident for this purpose when treated as a resident of a foreign country under a treaty, not waiving treaty benefits, and notifying the IRS on Forms 8833 and 8854. For a long-term resident, a tie-breaker claim made to reduce one year's tax can therefore have the same effect as giving up the green card. See when two countries claim you.

Compare the ways status can end and the tax effect

Handle the last year of US residence

Publication 519 says your residency termination date is usually December 31 of the last year you are a resident. You may use an earlier date, the first day you are no longer a lawful permanent resident, if for the rest of the year your tax home was in a foreign country and you had a closer connection to it. You must file a signed statement setting out the facts, including the date status was abandoned and documents that show it. Publication 519 calls someone who is both a resident alien and a nonresident alien in the same year a dual-status alien.

Keep copies of the filed Form I-407, proof of receipt and the green card you surrendered with your tax records. See records to keep.

Common misconceptions

Questions to take to a professional

1. How many tax years have I held a green card, and do any years not count because I was treated as a treaty resident?
2. Do I want to keep permanent residence, and if so, do I need a reentry permit before my next long trip?
3. If I file Form I-407, what will my residency termination date be, and do I meet the tax home and closer connection conditions for an earlier date?
4. Would I be a covered expatriate if my long-term residency ended this year?
5. If I claim a treaty tie-breaker, what are the immigration and expatriation tax consequences?
6. How do I document the end of status for the IRS?

Questions people ask

Sources

• Publication 519 (2025), U.S. Tax Guide for AliensOfficial guidance
• Instructions for Form 8854 (2025)Official guidance
• Expatriation taxOfficial guidance
• I-407, Record of Abandonment of Lawful Permanent Resident StatusOfficial guidance
• International travel as a permanent residentOfficial guidance