Entry / Exit Tax Planning

Residency determines which country can tax your income, whether you owe tax on worldwide income, and whether you must file foreign asset reports such as FBAR, FATCA, or Korean 해외금융계좌 신고.

But the U.S. and Korea use completely different residency rules:

• The U.S. uses the Substantial Presence Test + green card rules
• Korea uses domicile, family ties, economic ties, and intent
• The U.S.–Korea tax treaty provides tie‑breaker rules when both countries claim residency

Residency Status Planning ensures you are classified correctly, avoid double taxation, and stay compliant in both countries.

Clients often ask:

• “Am I a U.S. tax resident or a Korean tax resident”
• “Can I be a resident of both countries at the same time”
• “Do I owe U.S. tax on worldwide income if I live in Korea”
• “How does the Substantial Presence Test work”
• “Does Korea still consider me a resident after I move”
• “How do I use the treaty tie‑breaker rules”
• “What happens if my residency changes mid‑year”

These questions are extremely common — and the consequences of getting residency wrong can be significant.

We help you determine your correct residency status and plan your tax obligations accordingly.

✔ Determine U.S. Residency Status

• Substantial Presence Test
• Green card residency
• First‑year and last‑year residency rules
• Dual‑status year analysis
• Closer connection exception
• Residency start/termination dates

✔ Determine Korean Residency Status

• Domicile rules
• Family and economic ties
• Length of stay
• Permanent home availability
• Korean departure rules
• Non‑resident classification

✔ Apply U.S.–Korea Tax Treaty Tie‑Breaker Rules

When both countries claim residency, we analyze:

• Permanent home
• Center of vital interests
• Habitual abode
• Nationality
• Mutual agreement procedures

This determines which country has primary taxing rights.

✔ Plan for Residency Changes

Residency changes often occur when:

• Moving for work or study
• Obtaining or giving up a green card
• Spending extended time in either country
• Retiring abroad
• Returning to Korea after years in the U.S.

We help you plan the timing and tax impact of these transitions.

✔ Avoid Double Taxation

• Coordinate foreign tax credits
• Apply treaty benefits
• Allocate income between residency periods
• Optimize sourcing rules
• Avoid PFIC/CFC traps during residency shifts

✔ Reporting & Compliance

Residency determines which forms you must file:

• Form 1040 vs 1040‑NR
• Dual‑status returns
• FBAR (FinCEN 114)
• FATCA (Form 8938)
• Korean 해외금융계좌 신고
• Foreign entity reporting (5471, 8865, 3520)

We ensure all filings match your residency status.

Residency planning must be precise, coordinated, and forward‑looking.

• Treaty‑aligned: We apply the U.S.–Korea treaty strategically
• Holistic: Residency, income, and reporting all work together
• Timing‑focused: The date you enter or leave a country changes everything
• Risk‑controlled: Avoid penalties and compliance traps
• Clear explanations: No jargon — you understand your residency status