NRI & India tax
H-1B, F-1, L-1: Are You a Resident or Nonresident for U.S. Tax?
By the Elite B Tax Services team 6 min readUpdated October 7, 2026
The short answer
For U.S. tax, you are a resident alien if you pass the substantial presence test: at least 31 days in the U.S. this year and 183 days over three years, counting all days this year, one-third of last year's and one-sixth of the year before. Most H-1B and L-1 workers pass it and file Form 1040 like citizens. F-1 and J students usually don't count their days for their first years, so they often file Form 1040-NR.
Why your tax status matters
| Resident alien | Nonresident alien | |
|---|---|---|
| Return | Form 1040 | Form 1040-NR |
| Income taxed | Worldwide income, including India | Mainly U.S.-source income |
| FBAR / Form 8938 | Usually required above the thresholds | Generally not required |
| Standard deduction | Yes | Generally no (some treaty exceptions) |
The substantial presence test
You are a U.S. tax resident for the year if both are true:
- You were in the U.S. at least 31 days this year.
- This year's days + one-third of last year's days + one-sixth of the year before's days add up to at least 183.
Example: 120 days this year, 240 last year and 180 the year before gives 120 + 80 + 30 = 230 days, so you are a resident.
H-1B, L-1 and H-4
Work visa days count from the day you arrive. Most H-1B and L-1 holders pass the test in their first full year. If you arrived mid-year, you may be a dual-status taxpayer for that first year — nonresident before arrival, resident after — which has its own filing rules and options, including in some cases choosing to be treated as a resident for the whole year with your spouse.
F-1, J and other students
Students on F, J, M or Q visas who comply with their visa are 'exempt individuals': their days don't count toward the test, generally for their first five calendar years in the U.S. So most students file Form 1040-NR (and Form 8843), even while working on OPT.
When a student changes to H-1B, their days start counting — and the year of the change is often a dual-status year.
Common mistakes we fix
- Students filing Form 1040 with online software as if they were residents, and claiming credits they can't take.
- New H-1B workers forgetting that, once resident, their income from India must be reported.
- Missing the FBAR in the first resident year because the Indian accounts were opened years earlier.
- Not considering the India–U.S. treaty for students and trainees.
Sources: IRS — Substantial presence test · IRS — Publication 519, U.S. Tax Guide for Aliens
This guide is general information, not tax or legal advice for your situation. Rules and inflation-adjusted amounts change — contact us before you file. Read our disclaimer and editorial policy.