Liang, an NRA, is sent to the United States by Fuller Corporation, her foreign employer. She spends 50 days in the United States and earns $20,000 for a two-month period. This amount is attributable to 40 U.S. working days and 10 non-U.S. working days. Her employer does not have a U.S. trade or business and Liang spends no other time in the U.S. for the tax year. Liang's U.S.-source taxable income is:

Question

Quizplus · Accepted Answer

Liang's U.S.-source taxable income is only based on the days spent in the U.S., which is 40 days out of 50. Therefore, her U.S.-source taxable income is $16,000 ($20,000 x 40/50). The 10 non-U.S. working days are not subject to U.S. taxation. Since her foreign employer does not have a trade or business in the U.S. and she spends no other time in the U.S. for the tax year, her U.S. tax liability is based solely on her U.S.-source income.

Liang, an NRA, Is Sent to the United States by Fuller