knowledge topics
United States Persons
KNOWLEDGE EXPECTED OF: Both CFP® Professionals and QAFPTM Professionals
- Identify that income tax obligations in the United States are based on citizenship and residency status.
- Identify that residency is established on a case-by-case basis.
- Define a “United States Person” under the Internal Revenue Code of the United States.1
- Define an “Alien” for United States taxation purposes.2
- Explain the tests for determining if an individual is a United States resident for income tax purposes.
- Green Card Test3
- Substantial Presence Test4
- Explain requirements for an individual who qualifies as a resident of the United States under the Substantial Presence Test to be deemed to be a non-resident due to a “closer connection” to another country.5
- Identify factors that may establish that an individual has a closer connection to a country outside of the United States.5
- Identify that United States persons are required to pay tax on their worldwide income.
- Identify that United States persons may be required to file an annual tax return to the Internal Revenue Service (IRS).
Glossary of Verbs (mouse over to see definition)
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Define
To state exactly the meaning of
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Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
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Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
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Compare
To note the similarities and differences between two or more things
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Estimate
To determine an approximate value for
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Calculate
To find the value using mathematics
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Convert
To change from one form or purpose to another
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Evaluate
To reach a conclusion or make a judgement through careful study
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Interpret
To give the meaning of / to construe or understand / to translate orally
Read more about the Taxonomy used in the FP-BoK
REFERENCES
- https://www.irs.gov/individuals/international-taxpayers/classification-of-taxpayers-for-us-tax-purposes
- https://www.irs.gov/Individuals/International-Taxpayers/Immigration-Terms-and-Definitions-Involving-Aliens
- https://www.irs.gov/individuals/international-taxpayers/alien-residency-green-card-test
- https://www.irs.gov/Individuals/International-Taxpayers/Substantial-Presence-Test
- https://www.irs.gov/Individuals/International-Taxpayers/Conditions-for-a-Closer-Connection-to-a-Foreign-Country
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