United States: tax residency & income tax rates

Tax residency rules in United States

As of 2026, United States’s tax-residency test centres on a presence threshold of 183 days^ⓘInternal Revenue Service (IRS)“You will be considered a United States resident for tax purposes if you meet the substantial presence test for the calendar year. To meet this test, you must be physically present in the United States (U.S.) on at least:”View source · accessed 2026-08-20. This is the Substantial Presence Test (SPT), and it applies only to non-citizens (green card holders and citizens are taxed on worldwide income regardless of days present -- see citizenship-based taxation). It is not a simple single-year count like most countries on this site: a non-citizen becomes a US tax resident by being present at least 31 days in the current year AND at least 183 weighted days when adding all current-year days plus one-third of the prior year's days plus one-sixth of the days from the year before that -- so averaging around 122 days a year for three straight years alone can trigger residency.

Closer connection exception

Even a non-citizen who technically meets the Substantial Presence Test can still be treated as a non-resident alien for the year if they can show a 'tax home' in, and a closer connection to, another country -- provided they were not present in the US for 183+ days in the current year by itself. [source]Internal Revenue Service (IRS)“you can still be treated as a nonresident of the United States for U.S. tax purposes if you qualify for one of the following exceptions”View source · accessed 2026-08-20

Non resident alien taxation

Individuals who are neither citizens, green card holders, nor Substantial-Presence-Test residents are 'non-resident aliens' and are taxed only on US-source income -- the mirror image of the worldwide-income rule that applies to citizens, green card holders, and resident aliens. [source]PwC Worldwide Tax Summaries“Non-resident aliens are taxed on their US-source income and income effectively connected with a US trade or business (with certain exceptions).”View source · accessed 2026-08-20

Green card holder worldwide tax

Green card holders are taxed exactly like citizens on worldwide income, and remain resident aliens for tax purposes even after moving abroad indefinitely -- residency does not lapse just because someone leaves the country; it continues until the green card is formally given up. [source]PwC Worldwide Tax Summaries“All lawful permanent residents for immigration purposes (i.e. 'green card' holders). Resident alien status generally continues until the green card is formally relinquished.”View source · accessed 2026-08-20

Citizenship based taxation

The single most important fact distinguishing the US from virtually every other country on this site, which use physical-presence or ties-based residency tests: the US taxes its citizens (and green card holders) on worldwide income no matter where they live or how many days they spend inside the US. Day-counting rules like the Substantial Presence Test only govern whether a non-citizen becomes a US tax resident -- they are irrelevant to a citizen or green card holder, who stays fully taxable on worldwide income until they formally renounce citizenship or relinquish the green card. [source]Internal Revenue Service (IRS)“You are subject to tax on worldwide income from all sources and must report all taxable income and pay taxes according to the Internal Revenue Code.”View source · accessed 2026-08-20

Income tax rates in United States

As of 2025, the headline personal income tax rate in United States is 37%^ⓘPwC Worldwide Tax Summaries“For individuals, the top federal income tax rate for 2025 is 37%, except for long-term capital gains and qualified dividends”View source · accessed 2026-08-20. Federal top marginal rate on ordinary income for 2025, made permanent (along with the rest of the TCJA bracket structure) by the One Big Beautiful Bill Act (OBBBA). This is a progressive, multi-bracket system -- the 37% rate applies only to income above roughly USD 626,350 for single filers, with lower brackets applying below that. Most US states add their own income tax on top of the federal rate, so effective top marginal rates vary significantly by state (see state_income_tax_addon).

Federal income tax brackets

10–37% (as of 2025)^ⓘPwC Worldwide Tax Summaries“The OBBBA makes the income tax rates and brackets established by the TCJA permanent.”View source · accessed 2026-08-20 — Single-filer federal bracket structure for tax year 2025 (married filing jointly, head of household, and married filing separately use their own bracket tables with different thresholds). The brackets were made permanent by the OBBBA and continue to be indexed for inflation each year.

State income tax addon

Because state (and some municipal) income taxes stack on top of the federal rate, effective top marginal rates vary significantly across the US -- from roughly 37% federal-only in states with no income tax, to well above 40% combined in the highest-tax states. Washington has no income tax but taxes long-term capital gains via an excise tax. This site does not track all 50 individual state regimes. [source]PwC Worldwide Tax Summaries“Most states, and a number of municipal authorities, impose income taxes on individuals working or residing within their jurisdictions. Most of the 50 states impose some personal income tax, with the exception of Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, and Wyoming, which have no state income tax”View source · accessed 2026-08-20

Capital gains top rate

20% (as of 2025)^ⓘPwC Worldwide Tax Summaries“The maximum federal income tax rate on 'qualified dividends' received from a domestic corporation or a qualified foreign corporation is 20% (23.8% if the net investment income tax applies).”View source · accessed 2026-08-20 — Long-term capital gains (assets held over 12 months) and qualified dividends are taxed at preferential rates well below the 37% ordinary top rate -- up to 20% federal, or 23.8% once the 3.8% Net Investment Income Tax applies to higher earners.

Net investment income tax

3.8% (as of 2026)^ⓘPwC Worldwide Tax Summaries“A 3.8% 'unearned income Medicare contribution' tax applies on the lesser of (i) the taxpayer's net investment income for the tax year or (ii) the taxpayer's excess MAGI over a threshold amount (generally, USD 200,000 for single taxpayers and heads of households, USD 250,000 for a married couple filing a joint return and surviving spouses, and USD 125,000 for a married individual filing a separate return).”View source · accessed 2026-08-20 — Additional 3.8% Medicare surtax (the Net Investment Income Tax, or NIIT) on investment income such as interest, dividends, capital gains, and rents once modified adjusted gross income exceeds the threshold -- stacks on top of the regular capital-gains/dividend rates and the ordinary income brackets. Does not apply to non-resident aliens.

Non resident alien withholding rate

30% (as of 2026)^ⓘPwC Worldwide Tax Summaries“Non-resident aliens' US-source dividends generally are subject to a flat 30% tax rate (or lower treaty rate), usually withheld at source.”View source · accessed 2026-08-20 — Flat withholding rate on US-source FDAP income (dividends, interest, rents) paid to non-resident aliens, collected at source; a lower treaty rate may apply if the recipient's home country has an income tax treaty with the US.

Alternative minimum tax

26–28% (as of 2025)^ⓘPwC Worldwide Tax Summaries“In lieu of the tax computed using the above rates, the individual AMT may be imposed under a two-tier rate structure of 26% and 28%. For tax year 2025, the 28% tax rate applies to taxpayers with taxable incomes above USD 239,100 (USD 119,550 for married individuals filing separately).”View source · accessed 2026-08-20 — A parallel tax system (AMT) can apply instead of the regular bracket calculation for taxpayers with large preference-item deductions; it uses a two-tier 26%/28% rate structure with its own exemption amounts. The OBBBA made the exemption amounts permanent while resetting the phase-out thresholds to 2018 levels starting in 2026.

Special tax regimes in United States

USD 132,900 / year (as of 2026)^ⓘInternal Revenue Service (IRS)“For tax year 2026, the foreign earned income exclusion is $132,900 up from $130,000 for tax year 2025.”View source · accessed 2026-08-20 — Americans living abroad who qualify (see foreign_earned_income_exclusion_eligibility) can exclude up to this amount of foreign-earned income per person from US federal income tax each year (USD 132,900 for tax year 2026, up from USD 130,000 for 2025). The cap is adjusted annually for inflation, so verify the current tax year's figure before relying on it.

Foreign earned income exclusion eligibility

To claim the Foreign Earned Income Exclusion (and the related foreign housing exclusion/deduction), a US citizen or resident alien must have foreign earned income, a tax home in a foreign country, and meet either the bona fide residence test or the physical presence test. [source]Internal Revenue Service (IRS)“A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.”View source · accessed 2026-08-20

Feie does not reduce self employment tax

The Foreign Earned Income Exclusion lowers regular federal income tax on qualifying foreign self-employment earnings, but it does not reduce the separate self-employment tax (the self-employed equivalent of Social Security/Medicare payroll tax) -- a commonly missed nuance for self-employed Americans abroad. [source]Internal Revenue Service (IRS)“A qualifying individual may claim the foreign earned income exclusion on foreign earned self-employment income. The excluded amount will reduce your regular income tax but will not reduce your self-employment tax.”View source · accessed 2026-08-20

Digital nomad visa in United States

No (as of 2026)^ⓘCitizen Remote“No, unfortunately, the US does not have a specific visa for digital nomads. However, it has other options that digital nomads can use to live and work remotely, like the tourist visa.”View source · accessed 2026-08-20 — Unlike Spain, Portugal, or the UAE, the United States has no dedicated digital-nomad or remote-worker visa category. Remote workers who want to spend time in the US typically rely on the B-2 tourist visa or the Visa Waiver Program, neither of which authorizes working for a US employer, or on an employer-sponsored work visa such as the H-1B.

Frequently asked questions

Sources

• Internal Revenue Service (IRS) international taxpayers / substantial presence test · tax_authority, accessed 2026-08-20
• PwC Worldwide Tax Summaries individual / residence · big4, accessed 2026-08-20
• PwC Worldwide Tax Summaries individual / taxes on personal income · big4, accessed 2026-08-20
• Internal Revenue Service (IRS) newsroom / irs releases tax inflation adjustments for tax year 2026 including amendments from the one big beautiful bill · tax_authority, accessed 2026-08-20
• Internal Revenue Service (IRS) international taxpayers / expatriation tax · tax_authority, accessed 2026-08-20
• Internal Revenue Service (IRS) international taxpayers / us citizens and resident aliens abroad · tax_authority, accessed 2026-08-20
• PwC Worldwide Tax Summaries individual / income determination · big4, accessed 2026-08-20
• Internal Revenue Service (IRS) international taxpayers / foreign earned income exclusion · tax_authority, accessed 2026-08-20
• Citizen Remote visas / digital nomad visa usa · other, accessed 2026-08-20

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When to talk to an advisor

This page maps United States’s general rules — it cannot weigh your treaty position, your family and asset ties, or the timing of a move. If meaningful money depends on the answer, have a qualified advisor in United States (and in your home country) review your situation before you act.