Tax season is upon us and that means that our office receives many calls from intending immigrants and lawful permanent residents regarding their tax preparation requirements. Although our Firm does not specialize in tax law, we can provide some important information that can be taken to a professional tax preparer. Here are answers to some of the frequent questions we receive:
Do I need to file a tax return?
Generally, you must file a federal income tax return if your income is above a certain level. Other factors are considered as well, such as whether you are married, single, or head of household, your age, and the type of income you received. There may be other reasons to file a tax return even if you are not required to. We recommend you consult with a professional tax preparer if you have questions about whether you should file.
Should I file a tax return if I am intending to immigrate to the United States?
Yes. The new public charge rules became effective on February 24, 2020 and USCIS is now requiring that applicants for adjustment of status file a form I-944. Immigrant visa applicants who are applying for lawful permanent resident status through the consulates abroad must file a similar form issued by the Department of State.
The new Form I-944 Declaration of Self Sufficiency and the form issued by the Department of Stater require that applicants prove their income by submitting the most recent year’s federal income tax returns. Therefore, all applicants who are subject to the new public charge rules must have filed tax returns.
Because the tax returns are being submitted to immigration officers to prove that your income is high enough to support yourself and your household members, it is important that all your income is reported. If your employer pays you in cash, it is still important to report all income, including the cash. We recommend that you keep receipts or records of all cash income received so that you can pay taxes on the total amount and prove your income. A professional tax preparer can assist you if you have questions on how to pay income taxes on cash income.
Can I file income tax returns if I don’t have a social security number?
Yes. An intending immigrant may file federal income tax returns even if he or she does not have a social security number by using an Individual Taxpayer Identification Number (ITIN). An ITIN will be issued regardless of your immigration status and is available for undocumented immigrants.
If you do not have a social security number, you can apply for an ITIN by filing a Form W-7 along with your federal income tax return. Along with your Form W-7, you will need to prove your identity and foreign status to apply for an ITIN. Again, we recommend you consult with a professional tax preparer if you have questions on how to obtain your ITIN.
What filing status should I choose?
When filing your federal income tax returns, it is important to determine what your filing status will be and how many dependents you will declare. Immigration officers routinely look to applicants’ tax returns to verify information in the applicant’s application and to check for any inconsistencies.
For this reason, it is very important to make sure that your “filing status” accurately reflects whether you are “married”, “single”, or “head of household”. For example, if an applicant is applying for lawful permanent resident status based on a petition filed on her behalf by her United States citizen husband, it is important the she file her tax returns as “married”. Failure to file her returns as “married” could result in a negative determination by the immigration officer and a finding that her marriage is not bona fide.
On the other hand, an applicant who is obtaining lawful status as an unmarried son or daughter of a lawful permanent resident will want to be careful not to file his income tax returns as “married”. Doing so could result in a determination that the applicant became “common law married” under Colorado law, thereby causing him to lose his petition that was based on his “unmarried status”.
Which dependents should I declare?
Intending immigrants who must file a declaration of self sufficiency should carefully consider who will be listed on dependents on tax returns. If an applicant is declaring dependents in addition to his or her spouse and children, the household size will be increased and the amount of money the intending immigrant must earn to overcome a finding of public charge will increase. An applicant generally must show that she and her household members earn at least 125% of the federal poverty guidelines for her household size. Therefore, when the household size is increased by declaring additional dependents, the intending immigrant must necessarily earn more money. Applicants should therefore consult with an immigration attorney before declaring additional individuals such as nephews or nieces as dependents. A certified public accountant can provide information on who can legally be declared as a dependent.
Summary
Regardless of your immigration status, you are required to file income tax returns if your income meets a certain level. Tax returns are now an essential element of an intending immigrant’s application package if the intending immigrant is subject to public charge grounds of inadmissibility. How you file your income tax returns may also significantly impact your immigration case. For this reason, we recommend that all intending immigrants discuss their tax filing with a professional tax preparer and discuss with their immigration attorney as well.