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I have been working and living in the US from January 14th until October 19th on an L1 visum. Before this I lived in France and for the rest of 2018 (and later) I will be a working and living in Switzerland.

Since I pass the substantial presence test can I still file for dual status? Would this mean I am only taxed on my worldwide income during the period I was living there?

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  • I don't think so, but I am not sure. However, even if you get taxed for the whole year, the taxes you paid in other countries will be considered against your taxes due in the US, so it shouldn't matter.
    – Aganju
    Oct 23, 2018 at 11:45

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Assuming you are not a US resident for 2017, the First Year of Residency rules will apply, which for someone who is resident by passing the Substantial Presence Test, will make you a resident only for the part of the year after you first enter the US, and nonresident for the part of the year before that. So that already makes you a dual-status alien for 2018; you can choose to be treated as a resident for the whole years only if you are married.

As for the last part of the year, there also does exist Last Year of Residency rules, but unlike for First Year of Residency, there are additional conditions. You can qualify to have a residency termination date be the last day you are in the US instead of the end of the year, but only if for the rest of the year, your tax home was in a foreign country, and you had a "closer connection to a foreign country".

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  • So if I understand correctly terminating employment in the US (thus voiding my L1) and starting permanent tax residence in a foreign country under a different employer (for 2018 and 2019) would allow me to have an earlier last day of residence?
    – rtemperv
    Oct 24, 2018 at 7:43

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