1040 NR or 1040 for US / Romanian citizen living in Romania


I am an American citizen (naturalized) and also a Romanian citizen (by birth)
spending most of my time in Romania (more than 300 days/year), where I own a
permanent home and real estate investments, have family, civic activities,

In the US I own a vacation home which I visit for less than 60
days/year, and I only have some interest income from US banks, while from
Romania I have capital gains and rental income.

There is a Tax Convention between US and Romania, which qualifies me as a
fiscal resident of Romania, and which precludes the US from taxing my income
from Romania.

Question: Can I file as a NR (although a US citizen), possibly attaching form
8833 to 1040NR and exclude my income in Romania from US taxes ?

Thank you

david ingram replies;

Article XIII of the treaty DOES seem to stop the US from taxing your Romanian Capital Gains but it stops there.

For everything else, you are taxable on a US 1040 because as a US citizen, you are taxable on your income anywhere in the world.

The US will give you a foreign tax credit for taxes that you paid to Romania on interest and dividends and Romania will give you a credit for the 10% net tax you pay to the US. To achieve the 10% rate it might be necessary for you to file form 1116 and check off the 'resourced by treaty box'. Claim the benefits of Article XI.

A US citizen MUST file form 1040. US citizens do not file form 1040NR. Don't forget to file the TDF 90-22.1 forms for your Romanian Financial accounts. See the bottom two questions on schedule B.