The Immigrant Tax Return
Once again, the time has come to begin preparations for filing tax returns as required by U.S. law. Immigrants, both legal and undocumented, face a plethora of forms, questions, and answers that, in most cases, are new to them. They are also more vulnerable to fraud, scams, and misinformation that can affect their legal status in the U.S. or their ability to obtain legal status in the future, even if the problem was not their fault. Below I’ve gathered important information that all immigrants should know when filing their tax returns to help avoid problems, fraud, and scams. Is it true that undocumented immigrants have to pay taxes on their income in the United States? Yes. Everyone who works in the U.S. has to pay taxes on their income. It is a crime to work in the U.S. and not pay taxes. The person working in the U.S. you must pay taxes on any type of work or employment that produces income. This applies even if the person working is not legally in the U.S. Why should I file a tax return?
- It is the law.Filing taxes is required if you work in the U.S. Anyone who works in the U.S. and does not declare their income is breaking the law.
- Failure to declare your income could result in having to pay additional money in penalties or interest when the U.S. Treasury authorities (the IRS) realize that the tax return is missing in your case.
- There is a chance that you overpaid your taxes than you owed and are entitled to a refund that you would not be able to get if you do not file your tax returns.
- When you file your tax return, you may be eligible to have the taxes that were withheld from your paycheck returned.
- Filing taxes can help with an immigration case. Evidence from tax returns serves to prove that you are a person of good moral character. Showing good moral character is important to obtain some immigration benefits and to become a U.S. citizen.
Should I report my income if I used false data to get a job? Yes. Although the use of false information to get work is illegal, under the law there is no difference between legal or illegal entry. Illegal entry is still income that must be declared. With very few exceptions (e.g., identity theft), you will not be investigated for crimes or turned over to Immigration because you paid taxes on illegal income. How do I file my U.S. tax returns?
- U.S. citizens and legally admitted residents can file a tax return using their Social Security Number (“SSN”).
- Many undocumented immigrants cannot obtain a Social Security number. Undocumented immigrants can file a tax return using a Personal Taxpayer Identification Number (“ITIN”).
- For detailed information on how to get and use an ITIN to file a tax return, see:
What is an Individual Taxpayer Identification Number? An ITIN is a number given by the IRS to people who cannot obtain a social security number and are required to file annual tax returns. ITINs are used only for the tax return process and have no other purpose. Be given so that U.S. tax laws can be complied with. How can I get an ITIN? To obtain an ITIN you must fill out a Form W – 7, Application for IRS Personal Identification Number. You will have to include the documents that prove your identity and your status as a foreigner. Your federal tax return must also be attached to the application. What types of documents can be used to prove my identity when applying for an ITIN? Accepted forms of identification for the application for an ITIN include:
- National identity card (must be valid and show a photo, name, address, date of birth and expiration date.)
- A U.S. driver’s license
- Civil birth certificate (required for dependents under 18 years of age.)
- A foreign driver’s license.
- Id card from any U.S. state
- Foreign Relations voter registration card.
- U.S. Military ID Card
- Military identification card abroad.
- Visa issued by the U.S. Department of State
- Photo ID, from the U.S. Department of Citizenship and Immigration Services (USCIS)
- Medical records (for dependents only; under 14, under 18 if they are students)
- School records (dependents only; under 14, under 18 if they are students)
When should I apply for an ITIN? You should apply for an ITIN right away that you are ready to file your federal tax return.You can apply for an ITIN at any time during the year, but it must be applied by April 15 to avoid penalties and interest on income tax. How long does it take to receive my ITIN after applying? If the application for an ITIN is approved, you will receive your ITIN in approximately 6 weeks from the date of your application. If you don’t receive it within 6 weeks, call the IRS for information on the status of your application. How can I get help applying for an ITIN?
- You can call the IRS toll-free line at 1-800-829-1040 for information on what is required for an ITIN as well as help filing your tax return.
- You can visit one of the IRS Taxpayer Assistance Centers located throughout the U.S. that personally assist applicants.
- You can meet with an agent for ITIN application acceptance. An ITIN acceptance agent is a person or business that is approved by the IRS to provide assistance with the ITIN application. Your application and documents will be reviewed, a certificate of accuracy completed, and your application and tax return will be submitted to the IRS for processing. For a list of acceptance agents, go to the Acceptance Agent Program.
Will my immigration status be affected if I apply for an ITIN? No. Applying for an ITIN does not affect your immigration status in any way.The IRS does not report anyone to immigration authorities for applying for an ITIN if they are illegal in the U.S. The government wants you to pay your taxes and will not punish you for trying to get an ITIN. Do I have the right to work in the United States if I have an ITIN? No. An ITIN is not a Social Security number and cannot be used to get a job in the U.S. Alone to file a tax return even if the income was made without a work permit. Am I eligible for the Federal Tax Credit if I have an ITIN? No. If an ITIN is used to file your tax return, you are not eligible for the Federal Income Credit (“EITC”). To claim the EITC, you have to be a citizen or legal resident of the U.S. If I have an ITIN am I eligible for the Child Tax Credit? To qualify for the child tax credit, your child must be a U.S. citizen or a U.S. permanent resident. Which Form should I use to file my taxes? If you are a resident alien:
- Form 1040-EZ is the easiest form to use. It can be used if you have no dependents or have an income consisting of only wages, unemployment or interest:
- Form 1040 is the form to use if you have dependents or other income that cannot be reported on Form 1040-EZ
What Is The Marital Status I Can Use on My Tax Returns? Immigrants always use the same rules that apply to U.S. citizens. One of the following categories can be chosen for your tax return:
- Married Filing Jointly:
- whether you and your spouse were both resident aliens for the entire tax year; or
- sometimes you can choose to treat your spouse as a permanent resident for the entire tax year. Certain conditions apply
- Widowed who qualifies if:
- Your spouse died in the fiscal year and must have been a resident alien as well; and
- you have not remarried; and
- you have a dependent child living with you
- Head of Household: (NOTE: This is the category where you see the most fraud and scam.)
- you are not married or are not considered married on the last day of the year; or
- your spouse is a non-resident alien who has not chosen to be treated as a resident alien; and
- you pay more than half the costs to maintain a home for yourself and a qualifying person, usually a child living with you, [a spouse who has chosen NOT to be treated as a resident alien is NOT a qualifying person.];
- was a resident alien for the entire fiscal year.
- if you are married you must have been separated from your spouse during the last six months of the year.
Who qualifies as a dependent? There are some people who do not live in the U.S. may qualify as dependent and be claimed on your tax return if you provide more than 50% of your financial support. To be claimed on your tax return, each dependent must have their own Social Security number or ITIN. (Without these numbers, they cannot be claimed on your tax return. People you can claim as dependents include:
- Son or daughter
- Grandson or granddaughter
- Great-grandson or great-granddaughter
- Stepson or stepdaughter
- Adopted son
- Brother or sister
- Half-brother or half-sister
- Stepbrother or stepsister
- Mother, father, grandfather or great-grandfather
- The stepmother or stepfather
- Nephew or niece
- Aunt or uncle
- Son-in-law or daughter-in-law
- Brother-in-law and sister-in-law
- Father-in-law and Mother-in-law
- Foster child who was taken into your custody by court order or by an authorized government agency
Who qualifies as a spouse? For federal tax purposes, marriage means a legal union between two people.The U.S. recognizes marriages outside the U.S. with evidence of a marriage certificate. If you married outside the U.S. you will need to have your foreign marriage certificate as proof of your marriage in order to claim a spouse as a qualified dependent on your tax return. Who qualifies as a child? To qualify as a child for federal tax purposes, all of the following must be true: Relationship: The person must be:
- your son, daughter, stepson, foster child, or a descendant (e.g., your grandchild) of any of them, or
- your brother, sister, half-brother, half-sister, half-brother, stepsister or a descendant (e.g. your niece or nephew) or any of them;
Age: The person must be:
- under the age of 19 at the end of the year and younger than you (or your spouse if you file a joint return),
- a full-time student under the age of 24 at the end of the year and younger than you (or your spouse if you file a joint return), or
- permanently and totally disabled at any time during the year, regardless of age;
Residence: The person must have lived with you for more than half the year. There are exceptions for temporary absences, children who were born or died during the year, abducted children and children of divorced or separated parents; Maintenance: The person cannot have provided more than half of his or her own support during the year; Conclusion: Be very careful when filling out and submitting your tax returns.) Make sure to use qualified and authorized persons to assist in filling out your Tax Returns. Always keep copies of all documents for any future process in an immigration process.