A Guide to Taxes for U.S. Immigrants

Moving to a new country comes with a number of challenges - the potential of facing a language barrier, handling new currency, understanding customs and more. And when it comes to immigrants arriving in the United States, our federal tax system can often be a challenge to navigate on your own. Below are a few common questions U.S. Immigrants find themselves asking not just as the start of tax season, but as they look to join the workforce as well.

Do All U.S. Immigrants Need to File?

Yes, everyone who makes a certain income level, whether native-born or immigrated, are required to file a tax return. If you are a single filer and under 65, you must file if you’ve made more than $12,000 this year or $13,500 for those over 65. If you’re filing jointly with your spouse, both spouses will have to file if they’re under 65 and earned a combined $24,000 or more this year, or $26,600 for couples over 65.¹

What Is My Alien Tax Status?

All immigrants are considered to be of nonresident alien status unless they pass one of two tests determined by the IRS: the green card test or the substantial presence test. If an immigrant is a permanent resident of the United States and has been granted a green card from the government, then they are considered a resident alien. Alternatively, you may be considered a resident alien if you have passed the substantial presence test. This means you will have had to be physically present in the U.S. for 31 days during the current calendar year as well as 183 days during the 3-year period including this year and the 2 years immediately before that.²

What Kind of Income Needs to Be Reported?

Not only will you need to report your income made if it exceeds the appropriate income level, but you will also need to report any income you’ve made outside of the United States. According to the IRS, you are required to report “all interest, dividends, wages, or other compensation for services, income from rental property or royalties, and other types of income” whether acquired in the U.S. or not.³

Do My Family Members Have to Be Citizens to Be Claimed as Dependents?

You can claim exemptions for dependents if your children or spouse are U.S. citizens. In addition, you can claim your family as dependents if they have lived in Canada, Mexico or the United States for some part of the calendar year, but are not U.S. citizens.⁴

How Do I Fill Out a Form W-4 as a Nonresident Alien?

Whenever you start a new job in the United States, your employer will require you to fill out a Form W-4. This form is issued by the IRS and used as a way for an employee to tell their employer more about their tax situation. As a nonresident alien, the IRS provides a few special instructions to follow when filling out your Form W-4:

Do not write "exempt" on line 7 of the form
Claim only "single" filing status on line 3, even if you are married
You can claim only one personal exemption on line 5, unless you’re a resident of Canada, Mexico, South Korea, a U.S. national or a student or business apprentice from India.
You must write “Nonresident Alien” or “NRA” over the dotted line on line 6⁵

Tax season in America can be tricky for anyone to navigate, whether they’re native-born or recently immigrated. And when you’re moving to a new country for the first time, taxes are likely the last thing to learn on your to-do list. But with these important points to keep in mind, you can start preparing well in advance to make this tax season as smooth and simple as possible.

This content is developed from sources believed to be providing accurate information. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.