Explain how a nonresident alien is taxed in the year of arrival and departure if he or she arrives in the United States on July 1,

2010,and immediately establishes U.S.residency, and departs from the United States on October 1,2012,

thereby terminating his or her U.S. residency.

A.The alien will be taxed as a nonresident in the January 1,2010 through June 30 2010 portion of the tax year prior to establishing residency in the United States and in the October 2,2012 through December 31,2012 portion of the tax year in which residency is relinquished in the United States.

B.

Since the requirements for the substantial presence test were satisfied, the alien is taxed under the rules applying to a U.S. resident the entire time period between the establishment of residency and the termination of residency.

C.

Since the nonresident alien arrived in the United States half-way through 2010 he or she cannot be taxed under the rules applying to a U.S. resident.

D.

Both A and B are correct.