An Immigrant's Guide to Filing Taxes in America.
Many people, from all parts of the world, have moved to the United States. Some are lucky enough to be able to rely on a family member or friend to help them get established, but many others are forced to navigate the naturalization process on their own. Fortunately, I was able to rely on family already established in the United States to guide me along immigrating from the Dominican Republic.
One of the most useful pieces of advice I was given upon moving to the US, was ensuring my income was filed in accordance with the IRS. In the Dominican Republic, taxes are regulated differently. For example, individuals’ income tax is taken directly from their paychecks by the employer, who directly pays the government in turn. There are a few exceptions, such as being self-employed, where Dominicans do file their own taxes. However, this isn’t the majority’s experience.
Immigrants authorized to work in America must realize they are responsible to pay the same federal and state taxes citizens do. What is overlooked even more is that non-resident aliens who own businesses or have income that wasn’t taxed enough by their employer are also required to file tax returns.
Normally, individual income tax returns are due on April 15th of each year. As most of us learned just recently, this can change depending on different circumstances that interfere with peoples’ ability to accurately document their finances. The COVID-19 pandemic is obviously the most recent example of such interruptions.
In order to file your individual income taxes, you are required to have either a Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN). To obtain your SSN, simply complete an SS-5 form. You can find the official form here. For an ITIN, complete a W-7, found here. Further documentation will likely be required for both a SSN and ITIN.
Filling and paying your taxes on time every year has benefits, including:
Showing that you comply with federal tax laws, proving “good moral character.” This fulfills an important requirement for those intending to apply for a US Green Card, and become a permanent resident.
Ensuring your opportunity to receive a refund on taxes initially withheld from your paycheck. Even if you don’t owe anything to the IRS, filing documents your eligibility for future disbursement, like the stimulus checks sent out during the COVID-19 pandemic.
Avoiding late fees and other penalties for taxes past-due. Paying up-front, when first required to do so, is always less expensive than correcting past mistakes.
Providing proof of your US income towards applications for future investments, such as real estate property or financial loans.
There is so much to learn, and each individual has a unique experience with past taxation. As I quickly learned, it pays to have someone assist you on your journey in the United States. P+G Built Solutions is here to make things understandable, and help plan for your future. If you have questions, or require any financial planing, we’d love to hear from you!