For immigrants freshly arrived in America, everything they face is new: the customs, the currency, and for many, the language and even the climate. Yet one of the most significant (and confusing) learning curves they must climb is the U.S. tax system. In the U.S., if you earn over a certain amount of money, you must pay taxes on your income. Both the federal government and the states require that you file annual income tax returns detailing your income for that year, and enclose any payment due. The Internal Revenue Service, or IRS, is the government agency charged with collecting federal taxes.
Fortunately, we will provide a few key points that can make the filing process easier:
- Everyone files tax returns, many immigrants have paid taxes on their income for years in their countries of origin but have had no direct experience with income taxes. For a number of these people, the government withholds taxes from their pay and “that’s the end of it”. They don’t file returns and never see their refunds back. You must learn that in the U.S., everyone with income above certain levels is expected to file a tax return and receive their money back.
- Resident or non-resident alien, the IRS uses two tests — the green card test and the substantial presence test — for assessing your alien status. If you satisfy the requirements of either one, you’re considered a resident alien for income tax purposes; otherwise, you’re treated as a non-resident alien.
If you’re an alien with a green card, meaning the U.S. Citizenship and Immigration Service allows you to reside in the country legally, you are a resident alien. However, if you don’t have a green card and spend at least 31 days in the U.S. during the current tax year and a total of 183 days during the last three tax years (inclusive of the current tax year), you’ll usually satisfy the physical presence test and are also treated as a resident alien.
- Resident alien taxes, as a Green Card holder you are considered a legal U.S. resident, you’re subject to the same tax rules as U.S. citizens. This means that you must report all income you earn on annual tax returns, regardless of which country in which you earn it. When you will decide to prepare your tax return, we will always help you to fill all the necessary declarations.
IMPORTANT!Tax filing can be complicated for new permanent residents. If you are filing for the first time, we work with specialized accountants to help you file. We truly can help you with questions about your filing status, deductions and exemptions, our help can save you a lot of time and money.