TN Visa to Green Card: What Changes for Your Taxes

If you’ve been working in the US on TN status for a full year or more, you’re almost certainly a US tax resident already, so the green card changes little on next year’s return. What it changes is underneath: residency stops depending on your day count, it doesn’t end when you leave, the treaty tie-breaker gets costlier, and the eight-year clock for the US exit tax starts running. This builds on our TN visa tax guide and the Canada-to-US moving guide.

Does a green card change your taxes after TN?

On the return itself, usually not much. A TN worker who lives and works in the US is generally a resident under the substantial presence test, taxed on worldwide income with the same deductions and forms as a citizen. A green card makes you a resident under a second, separate test, so the return looks the same the year after the card arrives.

The statute treats a non-citizen as a US resident for any calendar year in which they’re “a lawful permanent resident of the United States at any time during such calendar year” (IRC 7701(b)(1)(A)(i)). The IRS says you generally have that status if USCIS issued you a Permanent Resident Card, Form I-551, and that you keep resident status under this test until you renounce it in writing to USCIS or it’s terminated administratively or by a federal court (IRS, green card test). That’s the whole extent of what this page says about immigration status; questions about applying for, keeping or giving up a green card go to an immigration lawyer.

Tax question	On TN status	With a green card
What makes you a US resident	The substantial presence test, year by year	The green card test, for any year you hold the card at any time
Does your day count matter	Yes, every year	No, for residency
Form 8840 closer connection exception	Possible in a year under 183 days with a foreign tax home and closer connection, if no green card steps were taken that year	Doesn’t help; it’s an exception to the day test only
When residency ends in a year you leave	Generally the last day you’re in the US, if you show a foreign tax home and closer connection for the rest of the year and aren’t a resident the next year	Not before the first day you’re no longer a lawful permanent resident, with the same showing
Treaty tie-breaker as a Canadian resident	Nonresident for computing tax; Form 1040-NR and Form 8833	Same filing, and it can end your permanent-resident status for tax and trigger expatriation rules
US exit tax (IRC 877A)	Doesn’t apply	Can apply once you’re a long-term resident
FBAR and Form 8938	Same rules for any resident alien	Unchanged

When does green card tax residency start?

If you were already a US resident at any time in the previous year, you’re treated as a resident from January 1, under either test (Pub. 519). That’s the usual position for a TN worker who’s been here a while, so the date on the green card doesn’t change the return at all.

The start date only matters for someone who wasn’t a resident the year before. Then the residency starting date under the green card test is the first day in the year you’re physically present in the US as a lawful permanent resident, and if you meet both tests, it’s the earlier of that day and your first day of presence under the substantial presence test (Treas. Reg. 301.7701(b)-4(a)). A Canadian who arrives on a green card in June after years living in Canada has a June start and a dual-status year; a TN worker already living here doesn’t. That arrival year is filed as a dual-status return.

Can a green card holder use the treaty tie-breaker?

Yes, but it costs more than it does on TN status. If Canada also treats you as a resident and you claim to be a Canadian resident under the treaty, you’re treated as a nonresident alien for computing US tax for that part of the year, and you file Form 1040-NR with a completed Form 8833 (Treas. Reg. 301.7701(b)-7). The regulation says that for other Code purposes you’re generally still a US resident, but for a green card holder the statute goes further.

The bigger cost for a green card holder is in IRC 7701(b)(6). You stop being treated as a lawful permanent resident for tax if you begin to be treated as a resident of a foreign country under a treaty, don’t waive the treaty benefits, and notify the IRS. For a long-term resident, the IRS says the notice is given on Forms 8833 and 8854 and that this is one of the ways residency ends for the expatriation rules (IRS, expatriation tax). Pub. 519 puts it plainly: a tie-breaker claim “can trigger section 877A expatriation tax” in certain cases.

The regulation also says that filing Form 1040-NR as a treaty nonresident “may affect” the immigration authorities’ view of whether you qualify to keep your permanent residence (Treas. Reg. 301.7701(b)-7(b)). That’s an immigration question, and it’s one to put to an immigration lawyer before the return is filed. How the tie-breaker steps are read is in the treaty tie-breaker guide.

How does the 8-year exit tax clock work?

You’re a long-term resident if you were a lawful permanent resident in at least 8 taxable years during the 15 taxable years ending with the year your status ends (IRC 877(e)(2)). A year doesn’t count if you were treated as a resident of a foreign country under a treaty that year and didn’t waive the benefits (Form 8854 instructions). TN years never count, because TN isn’t permanent residence.

A long-term resident who stops being a lawful permanent resident is an expatriate, and the exit tax under IRC 877A applies only if you’re also a covered expatriate. That happens if any one of these is true (IRC 877(a)(2)):

• Your average annual net income tax for the 5 years before you expatriate is more than $211,000 for 2026 (Rev. Proc. 2025-32); the 2025 figure was $206,000 (IRS).
• Your net worth is $2,000,000 or more on the date you expatriate.
• You don’t certify on Form 8854 that you’ve met your US tax obligations for the 5 preceding years.

For a covered expatriate, all property is treated as sold at fair market value the day before the expatriation date, and the gain is reduced by an exclusion of $910,000 for 2026 (Rev. Proc. 2025-32) and $890,000 for 2025 (IRS). What giving up the card later involves is in whether you owe exit tax when you give up a green card, and if you move back to Canada and keep the card, the yearly filings are in green card holder living in Canada.

Does a pending green card affect Form 8840?

Yes. You can’t claim the closer connection exception for a year in which you had an application for adjustment of status pending or took other steps to apply for permanent residence (IRC 7701(b)(3)(C)). The regulation’s examples of those steps include an I-485 filed by you, and an I-130, an I-140 or a Department of Labor employment certification filed for you (Treas. Reg. 301.7701(b)-2(f)).

That matters in a short year. Someone who spent part of the year in the US, stayed under 183 days, and was counting on Form 8840 to stay a nonresident loses that route for the whole year once an employer files the petition at any point in it. For a full-time TN worker who’s already a resident by day count, it changes nothing.

What about your Canadian accounts and residency?

Your US reporting doesn’t change, because the forms key on resident-alien status, which you already had. FBAR applies to a resident alien under IRC 7701(b) (31 CFR 1010.350), and the Form 8938 instructions treat you as a specified individual if you’re a resident under either the green card test or the substantial presence test (Form 8938 instructions). Canadian accounts are reported the same way as before.

• RRSP and RRIF. Rev. Proc. 2014-55 treats an eligible individual as having made the treaty election to defer US tax on income building up inside the plan. Our guide to the RRSP and TFSA on a TN covers both accounts.
• TFSA. See whether a TFSA needs Form 3520.
• RESP. See cross-border RESP planning.
• Canadian mutual funds and ETFs. See whether they’re PFICs.

On the Canadian side, a green card isn’t one of CRA’s tests. Canada looks at residential ties, starting with a home, a spouse or common-law partner, or dependants in Canada (CRA, residency status). If you severed those ties when you took the TN job, you already left Canada for tax then, and the card changes nothing there. If you kept them, for example a spouse who stayed in Canada until the green card came through, your non-residence date is generally the latest of the day you left, the day your spouse or partner and dependants left, and the day you became a resident of the new country (CRA, leaving Canada). The deemed disposition (departure tax) happens on that date, not on the green card date (CRA, dispositions of property), and how Canada taxes the year you leave covers it.

This guide is general information, not tax advice for your specific situation. Which points apply, and how, depends on your facts.