USA Substantial Presence Test


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Hi guys,

I just got a new client who has E-2 visa and is 100% owner of US corporation by himself.
His previous accountant for past 2 years, didn't click "yes" to form 1120 questionnaire where it ask if any "foreign person" own 25% (or more) of stocks.

My question is this. Is that because of substantial presence test? If one passes presence test, would that even make my client not foreign for this question regarding foreign person owning 25% of stocks?

Thank you for reading.
 
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Drmdcpa

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A resident of the US is generally not considered a foreign person. I am not sure what the E2 visa is. But if the person is living and working in the US, they have a social security number. Thus the question gets marked no. If they leave the US for any extended period of time, then it may need to be marked yes even if they have a social security number.

I have a C Corp client; one owner is a resident alien, two are naturalized citizens, and two live in China. I only need to answer yes and list one as a non-US person because only one in China owns more than 25%
 

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