In the year of abandoning your Green Card (GC), you have the option to file dual-status returns (1040 and 1040NR) or a full-year return (1040). Additionally, you need to file Form 8854 if you have held your Green Card for 8 or more years.
To file a full-year return:
Create a resident TQ for the year you abandoned your G.C. and select GC Holder.
Complete the TQ as normal and report U.S.-sourced and worldwide income.
To file dual-status returns:
In the year of abandoning your Green Card, complete two TQs: one GC Holder (USA) Questionnaire and one ''dummy'' Non-Resident (NRA) Questionnaire for 2005, as our system allows only one TQ per year.
To do it:
Create a resident TQ, select GC Holder, and report your income information up until the date you abandon your Green Card.
Create a non-resident (NRA) TQ for 2005, select Not a US Citizen or GC Holder, and enter "365" days spent each year in the United States.
Complete your second TQ and enter your U.S.-sourced income information from the date you abandon your G.C. till the end of the year.
Notes:
2005 is a random year because our system only allows one TQ per year per person.
As opposed to the resident TQ, the non-resident TQ will only require U.S.-sourced income, not worldwide income.
To file Form 8854:
If you have held your Green Card for 8 or more years, download Form 8854 and fill out parts I, II and III, if applicable. You should not leave blanks - write N/A or "?".
Note: if you had held your Green Card from Dec 31, 2020 to Jan 1, 2021, it would be 2 years.
Upload Form 8854 to the Documents section once completed.
Submit your questionnaires for a tax preparer review. We will check Form 8854 for completeness and accuracy.
❗ Important note: we assist with Form 8854 only in conjunction with the tax return (not standalone).