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I am an international citizen and according to the rules specified on the IRS website at this link, I am a resident alien from 2020 (For years before this my status was non-resident alien). I lived in the Indiana state for the entire 2020 and for state income taxes I have to file only Indiana State tax return.

According to the information on this Indiana DOR page there are two options:

  1. Form IT-40 for Full year residents
  2. Form IT-40PNR and for Part-Year Residents and Full-Year Nonresidents

Until the previous tax year (2019) I used to file Indiana taxes as Nonresident using the form IT-40PNR. Yes, I used to file IT-40PNR despite living in Indiana for the entire year. I am not sure why this was the case, maybe because I was an international citizen or maybe because I was a nonresident alien according to the IRS.

However, as I mentioned from the tax year 2020, according to IRS, I am a resident alien now.

So my question is: Will I be a filling IT-40 for Indiana from year 2020 or will I continue using IT-40PNR? Why I am asking this is because despite my tax residency (as defined by IRS) being changed to Resident alien from Nonresident alien, I will still not qualify for in-state tuition for Indiana state, if I had to pay tuition on my own. So for the income tax purposes also will I continue to be a full year nonresident for Indiana or not?

I know this is a complex questions so please feel free to get back to me if you have some doubts.

PHcoDer
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1 Answers1

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Neither IRS's definition of residency1 nor Indiana's definition of residency for in-state tuition purpose should directly determine your residency for Indiana income tax purpose. 45 Ind. Admin. Code 3.1-1-21 defines residency for Indiana tax purpose:

"Resident" Defined. An Indiana resident is:

(a) Any individual who was domiciled in Indiana during the taxable year, or

(b) Any individual who maintains a permanent place of residence in this state and spends more than 183 days of the taxable year within this state; or ...

in which "domicile" is defined in 45 Ind. Admin. Code 3.1-1-22, which also points out there's no bright-line rule to determine a taxpayer's domicile. Additionally, 45 Ind. Admin. Code 3.1-1-24 defines that "a nonresident of Indiana is any individual, estate, trust, or other entity not included in the definition of "Resident" given in Regulation 6-3-1-12(010) [ 45 IAC 3.1-1-21 ]." 45 Ind. Admin. Code 3.1-1-23 explicitly draws the line for some special situations.

It looks like you'll have to try to see if you can fit yourself into one of these categories. I'm not a tax expert so I might have missed some pertinent regulations.

1IRS is a federal agency and doesn't command how each state taxes, while each state may choose to (or not to) conform part of federal taxation practices and rules.

I'm not a lawyer and you should not rely on this post as tax or legal advice. Consult a tax attorney.

xuhdev
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