Living in the United States: Two residency tests and worldwide income taxation

A non-citizen becomes a U.S. tax resident through one of two tests: a green card, or three years of weighted physical presence. Once a resident, you are taxed on your worldwide income, just like a citizen. This page presents the rules found on the U.S. Internal Revenue Service (IRS) website and official French websites, including 2026 figures where available. It does not cover state or local taxes.

The two tests that make you a US resident

A non-citizen is considered a non-resident by the IRS unless they meet either the green card test or the substantial presence test for the calendar year. The latter is calculated as follows: at least 31 days of presence in the current year, and 183 days over three years, calculated by counting 100 days in the current year, one-third of the days in the previous year, and one-sixth of the days in the year before last. The IRS example (120 days each year) yields 120 + 40 + 20 = 180 days: no residency.

Specifically excluded are transit days of less than 24 hours, days of medical incapacity, and days of certain students, teachers, or individuals affiliated with a foreign government; exclusion requires Form 8843. Even if the test is completed, the exception of a closer connection to a foreign country may allow you to be treated as a non-resident. The year of arrival or departure is generally considered to have dual status. Our Substantial Presence Test page details the calculation.

If you are also a French resident, the Franco-American convention determines your status: permanent home, center of vital interests, habitual residence, and nationality. Those invoking the convention as residents of the other country must file a 1040-NR with form 8833.

Global income, dates and reporting

Residents are taxed like citizens: their worldwide income is subject to U.S. tax and reported on Form 1040. The filing deadline is April 15 of the following year. An automatic two-month extension, until June 15, exists if your principal place of business and residence are outside the United States on April 15. Form 4868 extends the filing deadline to October 15. The IRS adds that U.S. citizens abroad report as if they were residents of the United States: citizenship, not residency, is the basis for this obligation.

2026 Federal Tax Scale and Standard Deduction

The standard 2026 deduction is 16,100 for a single person and 32,200 for a married couple filing jointly. As a rough estimate, using hypothetical assumptions: a married couple with a combined salary of 240,000 has a taxable income of 207,800 after deductions, resulting in federal income tax of 35,140 (14.64 of gross income). This figure excludes state taxes and social security contributions.

Capital gains and investment income: the NIIT threshold

Gains held for more than one year are considered long-term; those held for one year or less are taxed as ordinary income. For the 2025 tax year, the IRS provides 0 %s up to $48,350 $s of taxable income (single person) or $96,700 $s (couple), 15 %s up to $533,400 $s or $600,050 $s, and 20 %s above that. In addition, there is a 3.8 % contribution on net investment income (NIIT) above an adjusted income of $250,000 $s for a married couple filing jointly or $200,000 $s for a single person. This contribution does not apply to wages and is calculated using Form 8960.

Your accounts and contracts in France as seen by the IRS: FBAR and Form 8938

Two separate declarations address assets held abroad.

• FBAR (FinCEN 114). It concerns foreign financial accounts whose cumulative value exceeds 10,000 $ at any point during the year. Deadline: April 15, with automatic extension to October 15. It is filed with FinCEN, not with the income tax return.
• Form 8938. For a U.S. resident, the threshold is 50,000 $ at year-end or 75,000 $ at any time during the year (single), 100,000 $ and 150,000 $ for a couple filing jointly. It must be attached to the tax return; failure to file it will result in a penalty of 10,000 $.

The IRS list for Form 8938 includes any interest in a foreign-issued insurance or annuity contract with a cash surrender value, provided it is held as an investment and not in a financial account. Therefore, a French assurance-vie policy can be included in your US tax return. The IRS page on FBAR does not mention these contracts. On the French side, as long as you remain a resident of France, Form 3916-bis covers contracts issued outside of France.

Inheritance and gifts: a threshold of $15 million

For deaths in 2026, the basic exclusion for federal estate tax is 15,000,000 $, and the Form 706 filing threshold is aligned with this amount. The annual gift exemption is 19,000 $, and 194,000 $ for a non-U.S. citizen spouse. Domicile for the purposes of this tax is determined by the intention to remain; a green card is not conclusive proof. A green card holder files Form 706 if they are domiciled in the United States; otherwise, they file Form 706-NA. Our page on non-citizen estate tax discusses this further. The 1978 French-American inheritance and gift tax treaty is discussed on our treaty page.

Local retirement savings

For 2026, the salary deferral limit for a 401(k) is $24,500 $ and for an IRA it is $7,500 $ (compared to $23,500 $ and $7,000 $ in 2025). The deductibility of an IRA decreases with income when an employer-sponsored plan covers the taxpayer. We are not discussing U.S. assurance-vie products here.

Social security, residence and visa

A Franco-American social security agreement, signed on March 2, 1987, and in effect since July 1, 1988, applies the rule of the country where one works. The initial posting of an employee to the United States must be for a period of five years or less (CLEISS). France Diplomatie indicates that the ESTA covers tourist or business stays of up to 90 days, and that a visa is required for stays exceeding this period; the page displays an update from 2013, still indicated as being in effect in July 2024.

The threshold of 183 weighted days: a numerical example (fictitious profile)

Situation. A French executive, a fictional profile, spends 90 days in the United States in 2024, 120 days in 2025 and 150 days in 2026.

Issue. He has 150 days in 2026, which is less than 183, and believes himself to be a non-US resident.

Strategy. It applies the IRS weighting: 150 days, plus one third of 120, plus one sixth of 90.

Result. 150 + 40 + 15 = 205 days, which is 22 days above the threshold of 183, with more than 31 days in 2026. The substantial presence test is met for 2026. The closer link exception and the convention remain to be examined.

What changes depending on your situation

• Your nationality: A US citizen is taxed on their worldwide income wherever they live.
• The number of days of attendance over three years, and your status (green card, visa).
• Your household: a family filing jointly or a single person does not have the same thresholds.
• Your assets in France: accounts, assurance-vie contracts, securities.
• Your state of residence: its taxes are not processed here and are validated with a US professional.