For tax purposes, an alien is an individual who is not a U.S. citizen. Aliens are classified as nonresident aliens and resident aliens. This publication will help you determine your status and give you information you will need to file your U.S. tax return. Resident aliens generally are taxed on their worldwide income, the same as U.S. citizens. Nonresident aliens are taxed only on their income from sources within the United States and on certain income connected with the conduct of a trade or business in the United States.

Table A, Where To Find What You Need To Know About U.S. Taxes, provides a list of questions and the chapter or chapters in this publication where you will find the related discussion.

Answers to frequently asked questions are presented in the back of the publication.

The information in this publication is not as comprehensive for resident aliens as it is for nonresident aliens. Resident aliens are generally treated the same as U.S. citizens and can find more information in other IRS publications.

New rules for former U.S. citizens and former U.S long-term residents. If you expatriated after June 16, 2008, new rules apply regarding reporting your income and paying U.S. tax. These rules are explained in chapter 4 under Expatriation After June 16, 2008.

Withholding on foreign partners. A foreign partner can provide to a partnership a certification to reduce or eliminate the partnership's withholding tax obligation under section 1446 on the partner's allocable share of effectively connected taxable income from the partnership. Any certificate (including any updated certificates and status reports) submitted, or required to be submitted, after July 28, 2008, must comply with Regulations section 1.1446-6.The foreign partner must use Form 8804-C, Certificate of Partner-Level Items to Reduce Section 1446 Withholding. The partner gives the form to the partnership. For more information, including when the partnership has to file the form with the IRS, see the instructions for Form 8804-C.

Interest-related dividends and short-term capital gain dividends received from mutual funds. The exemption from 30% tax on certain interest-related dividends and short-term capital gain dividends received from a mutual fund or other regulated investment company has been extended through 2009. See Dividend Income in chapter 3.

IRA deduction increased. You may be able to deduct up to $5,000 ($6,000 if age 50 or older at the end of the year). You may be able to take an IRA deduction if you were covered by a retirement plan and your 2008 modified AGI is less than $63,000 ($105,000 if married filing jointly or a qualifying widow(er)).

Personal exemption and itemized deduction phaseouts reduced. Taxpayers with adjusted gross income above a certain amount may lose part of their deduction for personal exemptions and itemized deductions. The amount by which these deductions are reduced in 2008 will be only ½ of the amount of the reduction that otherwise would have applied in 2007.

Tax rate on qualified dividends and net capital gain reduced.  The 5% tax rate on qualified dividends and net capital gain is reduced to zero. For nonresident aliens, this applies only to qualified dividends and net capital gain that are effectively connected with a U.S. trade or business.

First-time homebuyer credit. If you are a resident alien, you may be able to claim a credit of up to $7,500 ($8,000 if you purchased your home in 2009) if:

See Form 5405, First-Time Homebuyer Credit, for more information.

Tax relief for Kansas disaster area. Temporary tax relief was enacted as a result of the May 4, 2007, storms and tornadoes that affected the Kansas disaster area. The tax benefits provided by this relief include suspended limits for certain personal casualty losses and special rules for withdrawals and loans from IRAs and other qualified retirement plans. For more details on these and other tax benefits related to the Kansas disaster area, see Pub. 4492-A.

Tax relief for Midwestern disaster areas. Temporary tax relief was enacted as a result of severe storms, tornadoes, or flooding that affected Midwestern disaster areas. The tax benefits provided by this relief include the following:

For more details on these and other tax benefits related to the Midwestern disaster areas, see Pub. 4492-B.

IRA deduction expanded. You may be able to take an IRA deduction if you were covered by a retirement plan and your 2009 modified adjusted gross income (AGI) is less than $65,000 ($109,000 if married filing jointly or a qualifying widow(er)).

Making work pay credit. If you are a resident alien who had earned income in 2009, you may be eligible for a refundable tax credit. The credit is the lesser of:

For details, see Internal Revenue Code section 36A.

Portion of unemployment compensation not taxable. The first $2,400 of unemployment compensation for 2009 is exempt from federal income tax. Any unemployment compensation over $2,400 is taxable.

New deduction for sales and excise taxes on motor vehicles. Resident aliens may be able to deduct state or local sales and excise taxes paid on the purchase of new cars, light trucks, motor homes, and motorcycles after February 16, 2009, as an itemized deduction or as part of the standard deduction. For details, see Internal Revenue Code sections 63 and 164.

Third party designee. You can check the “Yes” box in the “Third Party Designee” area of your return to authorize the IRS to discuss your return with a friend, family member, or any other person you choose. This allows the IRS to call the person you identified as your designee to answer any questions that may arise during the processing of your return. It also allows your designee to perform certain actions such as asking the IRS for copies of notices or transcripts related to your return. Also, the authorization can be revoked. See your income tax package for details.

Change of address. If you change your mailing address, be sure to notify the Internal Revenue Service using Form 8822, Change of Address.

Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.