The Substantial Presence Test Explained for US Expats (2026 Rules)

Your residency status determines whether you are taxed like a US citizen on your worldwide income, or like a nonresident on just your US-source income. If you are an expat, digital nomad, or frequent traveler, getting this architecture wrong can lead to severe IRS penalties or missed international treaty benefits.

In this video, Justin Reslan, CPA and Founder of My Millennial CPA, breaks down the exact forensic math the IRS uses to determine your tax residency.

We cover the critical differences between the Green Card Test and the Substantial Presence Test, including the hidden trap of the 3-year weighted lookback formula (where 2026 days count at 100%, 2025 at 33.3%, and 2024 at 16.6%). We also explain why travel days and layovers count as full days, and how to utilize Form 8840 for the Closer Connection Exception.

Need help with your specific travel logs? https://mymillennialcpa.com/tax-advice-residency.html
Book a structural audit to determine your exact tax residency status before you file: https://mymillennialcpa.com/Contact.html

Video Chapters:
0:00 - Why Tax Residency Status Matters
0:35 - The Green Card Test Explained
0:50 - What is the Substantial Presence Test?
1:20 - The 183-Day Weighted Formula (With Example)
2:15 - Resident vs Nonresident Filing (Form 1040 vs 1040-NR)
2:45 - How to Claim the Closer Connection Exception (Form 8840)
3:15 - Book a Structural Tax Audit

#expats #greencard #taxresidency #digitalnomad #irscompliance #taxengineering #mymillennialcpa

Видео The Substantial Presence Test Explained for US Expats (2026 Rules) канала My Millennial CPA