How do dual status tax residents file their US returns?

The dual status tax situation can be tricky, but don't worry too much! When you're a dual status taxpayer (meaning you were a nonresident alien for part of the year and a resident alien for part of the year), you generally need to file a tax return that covers the entire calendar year but treats the two periods differently. For the part of the year you were a nonresident (January to May in your case), you're only taxed on your US-source income, if any. For the part of the year you were a resident (May to December), you're taxed on your worldwide income, including anything you earned in Canada during that period. Typically, you'll file Form 1040 with "Dual-Status Return" written across the top, and attach a Form 1040-NR to show your income during the nonresident portion of the year. You'll also need to include a statement showing which income belongs to each period. Standard tax software often struggles with dual-status returns, so you might need specialized help or software. Remember that as a dual status filer, there are certain limitations - you can't take the standard deduction, you can't file jointly if married, and some credits aren't available to you. But there are tax treaties between the US and Canada that can help prevent double taxation.

I was in your exact situation last year and I spent weeks trying to figure out dual status returns before I found taxr.ai at https://taxr.ai and it completely saved me. Their software handles dual status returns specifically and helped me understand which income was taxable where. I was most confused about my investment income from both countries and the foreign tax credit calculations, but they have a special module for expats and immigrants that walks you through the whole process. I uploaded my Canadian tax documents and my US paystubs, and it organized everything properly for both the 1040 and 1040-NR portions. They even helped me identify deductions I didn't know I qualified for as a dual status resident.

I have to admit I was wrong about taxr.ai. After posting my skeptical comment, I decided to try it when I realized my accountant wouldn't be available before the filing deadline. The dual status portion was actually really comprehensive - it separated my UK and US income correctly, applied the proper tax treaty provisions, and even identified that I was eligible for certain moving expense deductions I didn't know about. The system automatically created the statement showing which income belonged to my resident vs. non-resident periods and properly labeled everything on my return. I was particularly impressed with how it handled my foreign investment accounts and the FBAR requirements. Just got my refund last week - about $1,200 more than I expected! Definitely using it again next year when I'll be filing as a full-year resident.

If you need to talk to the IRS directly about your dual status questions (which I highly recommend), use Claimyr at https://claimyr.com to get through to them quickly. I spent THREE DAYS trying to reach someone at the IRS international taxpayer line about my dual status return from Germany last year, and it was impossible. With Claimyr, I got through in about 15 minutes. They have this system that holds your place in line and calls you back when an IRS agent is ready. You can see how it works in this demo: https://youtu.be/_kiP6q8DX5c. The IRS agent I spoke with actually explained some specific dual status situations that weren't clear on their website, like how to handle retirement accounts from my home country and which tax treaty benefits applied to my situation.

I need to apologize for my skeptical comment about Claimyr. I actually tried it yesterday out of desperation after my third attempt to reach the IRS failed. I couldn't believe it when my phone rang about 20 minutes later with an actual IRS international tax specialist on the line! The agent spent almost 30 minutes walking me through exactly how to document my Australian superannuation on my dual status return and clarified which forms I needed for my specific situation. She even explained a special provision in the US-Australia tax treaty that my accountant had missed. The time and stress it saved me was honestly worth way more than what the service cost. Sometimes being proven wrong is actually a good thing!

Don't forget about state taxes too! Dual status applies to federal returns, but states have their own rules for part-year residents. I moved from Brazil to California mid-year and had to file a part-year California resident return in addition to my federal dual status return. Some states are more aggressive than others about taxing worldwide income even for part-year residents.

Has anyone used TurboTax or H&R Block for dual status returns? Their websites say they support them but I'm worried they might miss something important.

As someone who's filed dual status returns for 3 years now, my biggest advice is to make sure you keep track of your "residency starting date" documentation. The date you became a US resident for tax purposes might not be the exact date you physically arrived in the US. For example, if you pass the substantial presence test later in the year, that becomes important. I recommend keeping copies of your I-94, visa approval, first US paycheck, utility bills, lease, etc., in case you ever get questioned about your residency start date.

Great point about documentation! I learned this the hard way when the IRS questioned my residency start date during an audit. They wanted to see proof of when I actually established US tax residency versus when I first entered the country. One thing to add - if you're on an H-1B or similar work visa like Connor, your residency start date is typically the later of: (1) your first day of US employment, or (2) when you meet the substantial presence test. Since Connor started working in May 2024, that's likely his residency start date, making January-April his nonresident period and May-December his resident period. Also, don't forget about Form 8843 if you were a student or had any exempt days during your nonresident period. And if you have any foreign bank accounts with more than $10,000 total at any point during the year, you'll need to file FBAR (FinCEN Form 114) regardless of your dual status situation. The filing requirements for foreign accounts apply to US tax residents, so once you became a resident in May, all your worldwide accounts became reportable.