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What constitutes work?

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Thank you very much for the replies so far. Lots of interesting info... lots to digest as well.

For those interested in the topic - I know there are other people here with the same type of job - I have also posted a question in the Canadian forum and have gotten some interesting replies in there as well.

I will let you know what I find out on my side. Hopefully I will get some definite answers that can help out more people.

This may help you some, kinda hard to find US tax info specific to Canada.

Income from self-employment. Income from services performed (other than those performed as an employee) are taxed in Canada if they are attributable to a permanent establishment in Canada. This income is treated as business profits, and deductions similar to those allowed under U.S. law are allowable.

If you carry on (or have carried on) business in both Canada and the United States, the business profits are attributable to each country based on the profits that the permanent establishment might be expected to make if it were a distinct and separate person engaged in the same or similar activities. The business profits attributable to the permanent establishment include only those profits derived from assets used, risks assumed, and activities performed by the permanent establishment

http://www.irs.gov/publications/p597/ar02.html

'PAU' both wife and daughter in the U.S. 08/25/2009

Daughter's' CRBA Manila Embassy 08/07/2008 dual citizenship

http://crbausembassy....wordpress.com/

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Kizza,

there are usually quite a few knowledgeable people on this board, which is why I'm surprised about the random "bitsa" answers that were posted so far.

From a purely legal standpoint, you cannot work without work authorization in the US. You cannot even work without compensation. You cannot volunteer. Thus, you cannot open a business and do any tasks for that business, such as organizing, as this would constitute work. Strictly speaking, while in the US, you cannot even check your Canadian business e-mails from your laptop or iPhone.

Now, is that stupid? Of course it is. It's as ridiculous as it gets. To play devil's advocate, however, it's not about taking away a job from a USC or LPR in the US. It's more or less about the Feds avoiding having to deal with a potential gray zone of how the "working person" is compensated, or not compensated at all. You volunteering for free at an event and just get a hot dog as a "thank you," might prevent a non-volunteer to have received compensation, they would or at least could argue.

That said, in the real world, nobody cares as long as nobody formally files a complaint about you, and that would be very unlikely, unless you have enemies looking over your shoulder.

There is the law, and there is always a way to interpret it, and then there's another way. Unfortunately, when it comes to the gunfight, the Fed most likely will win.

There is no room in this country for hyphenated Americanism. When I refer to hyphenated Americans, I do not refer to naturalized Americans. Some of the very best Americans I have ever known were naturalized Americans, Americans born abroad. But a hyphenated American is not an American at all . . . . The one absolutely certain way of bringing this nation to ruin, of preventing all possibility of its continuing to be a nation at all, would be to permit it to become a tangle of squabbling nationalities, an intricate knot of German-Americans, Irish-Americans, English-Americans, French-Americans, Scandinavian-Americans or Italian-Americans, each preserving its separate nationality, each at heart feeling more sympathy with Europeans of that nationality, than with the other citizens of the American Republic . . . . There is no such thing as a hyphenated American who is a good American. The only man who is a good American is the man who is an American and nothing else.

President Teddy Roosevelt on Columbus Day 1915

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I'm a CPA and international a tax specialist and a US resident for income tax purposes is tax on their worldwide Income. However, the meaning of residence for income tax purposes as defined on Title 26 USC (Internal revenue Code) has nothing to do with US residency for immigration purposes. There is a formula that looks back three years weighted to the current year and if you exceed 180 days you are a US resident for income tax purposes and should file a US Income tax return.

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Under the substantial presence test, an alien individual who is present in the United States for at least 183 days during the taxable year is a resident for tax purposes, and an alien present in the country for fewer than 183 days during the current year is a resident if she is present for at least 31 days during the year, spends substantial portions of her time in the country during the three-year period ending with the taxable year, and has a closer connection to the United States than to any foreign country.

Normally, the substantial presence test is met for a particular calendar year if the taxpayer is present in the United States on at least 31 days during the year and meets a 183-day test. The 183-day test is satisfied only if the sum of the days present in the United States during the taxable year, one third of the days present during the immediately preceding calendar year, and one sixth of the days present during the second preceding year is at least 183. The 183-day test is met, for example, if the taxpayer has been present for 122 or more days during each of these three calendar years (122 plus one third of 122 plus one sixth of 122 equals 183).

An alien individual who meets both the 31-day test and the 183-day test is nevertheless a nonresident if she (1) is present in the United States for fewer than 183 days during the current year; (2) has a tax home in a foreign country during the year; and (3) has a closer connection to that country than to the United States. An individual has a “tax home” at a particular place if she would be allowed a deduction under § 162(a)(2) for expenses incurred in traveling away from that place on business. According to the regulations, this means that an individual's tax home is at her regular place of business or if she has more than one regular place, at the principal place of business. An individual has the closest connection with the country with which she “has maintained more significant contacts,” including the location of her permanent home, family, personal belongings, and personal bank accounts, the location of the social, political, cultural, and religious organizations “with which the individual has a current relationship,” where she obtained her driver's license, where she votes, and the country of residence designated on documents filed by the individual. However, the closer connection exception is not available if the individual has applied to become a permanent resident and this application is pending at any time during the taxable year.

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Kizza,

there are usually quite a few knowledgeable people on this board, which is why I'm surprised about the random "bitsa" answers that were posted so far.

From a purely legal standpoint, you cannot work without work authorization in the US. You cannot even work without compensation. You cannot volunteer. Thus, you cannot open a business and do any tasks for that business, such as organizing, as this would constitute work. Strictly speaking, while in the US, you cannot even check your Canadian business e-mails from your laptop or iPhone.

Now, is that stupid? Of course it is. It's as ridiculous as it gets. To play devil's advocate, however, it's not about taking away a job from a USC or LPR in the US. It's more or less about the Feds avoiding having to deal with a potential gray zone of how the "working person" is compensated, or not compensated at all. You volunteering for free at an event and just get a hot dog as a "thank you," might prevent a non-volunteer to have received compensation, they would or at least could argue.

That said, in the real world, nobody cares as long as nobody formally files a complaint about you, and that would be very unlikely, unless you have enemies looking over your shoulder.

There is the law, and there is always a way to interpret it, and then there's another way. Unfortunately, when it comes to the gunfight, the Fed most likely will win.

And this is not random bitas? :wacko:

'PAU' both wife and daughter in the U.S. 08/25/2009

Daughter's' CRBA Manila Embassy 08/07/2008 dual citizenship

http://crbausembassy....wordpress.com/

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To the person that mentioned social security benefits that is cover in a treaty

Under the US Canada Income tax Treaty:

Social security benefits paid by one country to a resident of the other and, in the case of Canadian benefits, to a U.S. citizen are taxable only by the country where the recipient lives [ Article XVIII(5) ; 1997 Protocol, Article 2 ]. In this regard, U.S. social security benefits paid to a Canadian resident are taxable in Canada as though they were benefits under the Canada Pension Plan, except that 15% of these benefits is exempt from Canadian tax. Similarly, Canadian social security benefits paid to a U.S. resident are taxable in the United States as though they were a payment under the U.S. Social Security Act, except that a type of benefit that is not subject to Canadian tax when paid to Canadian residents is exempt from U.S. tax

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Kizza,

there are usually quite a few knowledgeable people on this board, which is why I'm surprised about the random "bitsa" answers that were posted so far.

From a purely legal standpoint, you cannot work without work authorization in the US. You cannot even work without compensation. You cannot volunteer. Thus, you cannot open a business and do any tasks for that business, such as organizing, as this would constitute work. Strictly speaking, while in the US, you cannot even check your Canadian business e-mails from your laptop or iPhone.

Now, is that stupid? Of course it is. It's as ridiculous as it gets. To play devil's advocate, however, it's not about taking away a job from a USC or LPR in the US. It's more or less about the Feds avoiding having to deal with a potential gray zone of how the "working person" is compensated, or not compensated at all. You volunteering for free at an event and just get a hot dog as a "thank you," might prevent a non-volunteer to have received compensation, they would or at least could argue.

That said, in the real world, nobody cares as long as nobody formally files a complaint about you, and that would be very unlikely, unless you have enemies looking over your shoulder.

There is the law, and there is always a way to interpret it, and then there's another way. Unfortunately, when it comes to the gunfight, the Fed most likely will win.

YES YOU CAN OPEN AN LLC IN THE UNITED STATES EVEN AS A NON-CITIZEN/RESIDENT!!!! This is not bitsa, it is FACT!!!!!!!!!!!!!!!!

You can, even if you are not a US citizen or permanent resident, own an interest in a limited liability company located in the United States. Just so there's not confusion, let me also confirm that you can also be the sole owner--the single member--of a limited liability company located in the United States.

The only rub here is that the setup and maintenance of the LLC will be a little more complicated if you're living outside the US. But let me explain.

Tips for LLC setup by non-US citizens and residents

To form a limited liability company in the United States, you will need to work with a paralegal service, an accountant or an attorney to prepare and submit your limited liability company formation documentation. You will also need to get the paralegal service, accountant or attorney to act as your registered agent.

The registered agent requirement is really the only "setup" complication related to you not being a US citizen or permanent resident. So let me talk about the registered agent issue just a little bit more. A registered agent is just a real live human being who resides (or a business with real live human beings which operates) in the state where you set up your LLC.

You need a "real person" to be your registered agent so the state and anyone else has someone they can contact if they have questions about or problems with your limited liability company. Typically online paralegal services, any attorney or law firm, many accountants, and even specialized "registered agent" services will for a modest fee act as your registered agent.

Tips for LLC operation by non-US citizens and residents If you operate a limited liability company in United States, you will probably own a tax return to United States and to the state in which you form your new limited liability company. That will probably mean that you need to work with a US accountant to file those federal and state income tax returns.

Tip: The accountant who prepares your federal and state tax returns will probably happily take on the role of "registered agent" if you ask.

Let me make one final comment about a non-US citizen or permanent resident operating a limited liability company located in the US. You should know that a US limited liability company will often have a duty to withhold taxes from remittances paid to non-US citizens or non-permanent residents.

For example, if you and a partner set up a California limited liability company to run an online internet venture in the United States, when the California limited liability company disburses money to you and your partner, the state of California will want the LLC to withhold California income taxes from those payments and then pass along those withholding amounts to the state revenue agency. (You can, by the way, form your limited liability company in a state which doesn’t collect income taxes--like Nevada, Washington, and so forth.)

Note, too, that the federal government also typically requires withholding in the case where a multiple member limited liability company makes disbursements to members who aren't US citizens or permanent residents.

10/14/2000 - Met Aboard a Cruise ship

06/14/2003 - Married Savona Italy

I-130

03/21/2009 - I-130 Mailed to Chicago lockbox

11-30-09: GOT GREEN CARD in mail!!!!!!

Citizenship Process;

1/11/2013: Mailed N400 to Dallas Texas

3/11/2013: interview.. Approved

4/4/2013. : Oath! Now a U.S. citizen!

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You can, even if you are not a US citizen or permanent resident, own an interest in a limited liability company located in the United States. Just so there's not confusion, let me also confirm that you can also be the sole owner--the single member--of a limited liability company located in the United States.

Christeen,

in the future, before you respond, I suggest you make it a habit of reading the previous post thoroughly.

I wrote:

Thus, you cannot open a business and perform any tasks for that business, such as organizing, as this would constitute work.

Since you apparently had problems before, the emphasis in on the BOLD parts.

Somebody not authorized to work in the United States cannot work for an LLC either (duuuh!), not even if he or she is a member or even the sole member of said LLC.

This post is NOT about the tax liability of an LLC. It's about working of an immigrant lacking authorization to work from a purely legal standpoint. Is that really so difficult to comprehend?

Edited by Just Bob

There is no room in this country for hyphenated Americanism. When I refer to hyphenated Americans, I do not refer to naturalized Americans. Some of the very best Americans I have ever known were naturalized Americans, Americans born abroad. But a hyphenated American is not an American at all . . . . The one absolutely certain way of bringing this nation to ruin, of preventing all possibility of its continuing to be a nation at all, would be to permit it to become a tangle of squabbling nationalities, an intricate knot of German-Americans, Irish-Americans, English-Americans, French-Americans, Scandinavian-Americans or Italian-Americans, each preserving its separate nationality, each at heart feeling more sympathy with Europeans of that nationality, than with the other citizens of the American Republic . . . . There is no such thing as a hyphenated American who is a good American. The only man who is a good American is the man who is an American and nothing else.

President Teddy Roosevelt on Columbus Day 1915

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You can, even if you are not a US citizen or permanent resident, own an interest in a limited liability company located in the United States. Just so there's not confusion, let me also confirm that you can also be the sole owner--the single member--of a limited liability company located in the United States.

Christeen,

in the future, before you respond, I suggest you make it a habit of reading the previous post thoroughly.

I wrote:

Thus, you cannot open a business and perform any tasks for that business, such as organizing, as this would constitute work.

Since you apparently had problems before, the emphasis in on the BOLD parts.

Somebody not authorized to work in the United States cannot work for an LLC either (duuuh!), not even if he or she is a member or even the sole member of said LLC.

This post is NOT about the tax liability of an LLC. It's about working of an immigrant lacking authorization to work from a purely legal standpoint. Is that really so difficult to comprehend?

That is False! (should I put it in bold for you)!!! OP; You CAN open an LLC and perform functions as its' owner... You cannot take payment from that company until you have your work authorization... But owning and operating an LLC is not prohibited... There are also several threads of K-1's who have businesses... With an ITTN, you are free to operate a business here in the US..

To OP; please check with the SBA and they can give you details on the steps you have to take to open and LLC...

Also, there is no limit to volunteer work... Volunteer is for without pay, therefore you CAN volunteer!!!

Here is info on Volunteering;

The following describes the U.S. Citizenship & Immigration Service (USCIS) interpretation of the concept of “work” versus “volunteering.”

• A foreign national cannot perform work as a volunteer in a position that would normally be a paid position or if the foreign national believes that some form of compensation will follow. The U.S. Citizenship and Immigration Service (USCIS) views such volunteering as “work” and requires proper employment authorization issued by that agency. This specifically includes volunteering by a foreign national for a trial period leading up to compensated employment.

• [A]n applicant for a change of status may not offer his or her services to a prospective employer, even on a volunteer basis. The employment is unauthorized as long as the alien derives any benefit from it. (Lawrence J. Weinig, INS Deputy Assistant Commissioner for Adjudications, 66 NO. 19 Interpreter Releases 539)

• In addition, the volunteer rule may give rise to a number of potential abuses. For example, may an employer lawfully suggest to an alien that he or she should do a period of 'volunteer' work while the employer is deciding whether or not to file a nonimmigrant visa petition or a labor certification application? Recently, the INS indicated that an applicant for change in nonimmigrant status could not offer his or her services to a prospective employer on a 'volunteer' basis. The INS has stated that: 'If any type of benefit could accrue to the alien, though it may not be wages or fringe benefits, the services will be considered unauthorized employment.' (89-05 Immigr. Briefings 1)

• Volunteer services for a prospective employer constitute unauthorized employment if the alien will ultimately derive some benefit from the work. The ultimate question in most volunteer cases will be: What did the alien expect in return? If he or she expected compensation, reward, or future benefit, then the volunteer work probably violates status. (95-05 Immigr. Briefings 1)

10/14/2000 - Met Aboard a Cruise ship

06/14/2003 - Married Savona Italy

I-130

03/21/2009 - I-130 Mailed to Chicago lockbox

11-30-09: GOT GREEN CARD in mail!!!!!!

Citizenship Process;

1/11/2013: Mailed N400 to Dallas Texas

3/11/2013: interview.. Approved

4/4/2013. : Oath! Now a U.S. citizen!

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Not sure I want to step into this heated discussion, but would like to give the OP my thoughts.

Based on your timeline & being from Canada, you should have your EAD/GC by 12/31/10 (yes 2010). In the meanwhile, you move to the US, continue serving your clients and having them pay you in your Canadian acct.

For your 2010 US tax return - filed jointly with your wife - you file a Schedule C reporting your self-employment world-wide earnings. The IRS (who will be happy you are reporting all income) and the USCIS would have to really dig in to see that those earnings were while waiting EAD. I suggest your wife increase the amount withheld (on W-4) to cover your lack of estimated payments.

Someone quoted that you cannot "accept employment". Continuing your previous contracts, as a self employed person, doesn't quite fall under that. If you seek or service US clients, before you have EAD, that would be pushing the envelope, IMO.

Good Luck!!

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Phew.... Heated discussion indeed. Thanks for all your answers. Although some replies went a bit beyond the scope of my question, they provided interesting info and I'm taking note. I'll get my fiance to read about the fiscal aspect, because that's when it turns to chinese to me, but I'll know to be careful about what I say about volunteering in the US... which I have done quite a bit. Never thought that could be seen as a problem, on the contrary.

Between this post and the one in the Canadian forum, I have gotten a lot of replies. No consensus! On one hand, some people have done it and assure me it is legal (which I tend to believe, since I dont see how it would be "morally" wrong, from an immigration point of view - but I dont want to do anything that would jeopardise my situation), on the other, some are adamant it is illegal.

So I'll be consulting an attorney and/or accountant and I intend on getting back with detailed information because I am sure there are a lot of people in the same situation. If anybody has a good one to recommend, I would appreciate it. Would you recommend talking to an immigration lawyer in the US or in Canada?

Also, if anybody wants to contribute more info on the subject, at this point, preferably backed up with solid data, don't hesitate!!

AoS Process

AoS/EAD/AP file sent: 2011-02-16

Received: 2011-02-17

NOA: 2011-02-22

Touched: 2011-02-24

Hard copy NOAs received : 2011-02-28

Biometrics letter received: 2011-02-28

Biometrics appt: 2011-03-17

EAD & AP approved: 2011-04-28

AOS appt: 2011-05-12 (notice sent April 6) APPROVED :)

event.png

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Not sure I want to step into this heated discussion, but would like to give the OP my thoughts.

Based on your timeline & being from Canada, you should have your EAD/GC by 12/31/10 (yes 2010). In the meanwhile, you move to the US, continue serving your clients and having them pay you in your Canadian acct.

For your 2010 US tax return - filed jointly with your wife - you file a Schedule C reporting your self-employment world-wide earnings. The IRS (who will be happy you are reporting all income) and the USCIS would have to really dig in to see that those earnings were while waiting EAD. I suggest your wife increase the amount withheld (on W-4) to cover your lack of estimated payments.

Someone quoted that you cannot "accept employment". Continuing your previous contracts, as a self employed person, doesn't quite fall under that. If you seek or service US clients, before you have EAD, that would be pushing the envelope, IMO.

Good Luck!!

Hi, Im the PO, and I think it might have been me who mentionned the wording "accept employment", to emphasize the distinction between accepting employment in the US and continuing to operate a business in Canada.

I'll be noting your advice regarding tax returns... thank you for your reply.

BTW, I'll be the wife! ;)

AoS Process

AoS/EAD/AP file sent: 2011-02-16

Received: 2011-02-17

NOA: 2011-02-22

Touched: 2011-02-24

Hard copy NOAs received : 2011-02-28

Biometrics letter received: 2011-02-28

Biometrics appt: 2011-03-17

EAD & AP approved: 2011-04-28

AOS appt: 2011-05-12 (notice sent April 6) APPROVED :)

event.png

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I think you have gotten a consensus, I think you need to look back and see where the information is being backed. Still if your setting up a new business that does work outside the US, you'll find an attorney extremely helpful. I know we did.

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Phew.... Heated discussion indeed. Thanks for all your answers. Although some replies went a bit beyond the scope of my question, they provided interesting info and I'm taking note. I'll get my fiance to read about the fiscal aspect, because that's when it turns to chinese to me, but I'll know to be careful about what I say about volunteering in the US... which I have done quite a bit. Never thought that could be seen as a problem, on the contrary.

Between this post and the one in the Canadian forum, I have gotten a lot of replies. No consensus! On one hand, some people have done it and assure me it is legal (which I tend to believe, since I dont see how it would be "morally" wrong, from an immigration point of view - but I dont want to do anything that would jeopardise my situation), on the other, some are adamant it is illegal.

So I'll be consulting an attorney and/or accountant and I intend on getting back with detailed information because I am sure there are a lot of people in the same situation. If anybody has a good one to recommend, I would appreciate it. Would you recommend talking to an immigration lawyer in the US or in Canada?

Also, if anybody wants to contribute more info on the subject, at this point, preferably backed up with solid data, don't hesitate!!

It seems fairly simple to me: K-1s are not authorized to perform work without an EAD.

(The tax stuff is all a red herring btw)

The reason is the same reason the B entrants, Canadian tourists, VWP entrants etc can not come to the US and work for their home companies. Being paid outside the US has nothing to do with it. "Work" is limited in the US to citizens, PRs and authorized aliens. Your work would be performed inside the US and is governed by US law.

You can make your attorney call very simple: "I am in K-1 status. May I work inside the US for clients that are in another country?" The answer will be no.

I'm a US citizen. I work for myself. Some of MY clients are out of the country. I'm authorized to work, a K-1 isn't (until they have their EAD).

All the Canadian EI stuff is a red herring too; that is based on Canada's interpretation of what they allow and what they think your status is here.

I don't doubt that people have done it, and not been caught, but that isn't the question you put. Your question is about US law (it's your status in the US you should be worried about protecting), so your quesiton should go to a US immigration attorney.

This part of the CFR can be a starting point. You can also research further what constitutes 'work' in the US (looking at the B-1 limitations is a good start; there is a big difference between "business" and "work").

§ Sec. 214.2(k) Spouses, Fiancees, and Fiances of United States Citizens.

(9) Employment authorization . An alien admitted to the United States as a nonimmigrant under section 101(a)(15)(K) of the Act shall be authorized to work incident to status for the period of authorized stay. K-1/K-2 aliens seeking work authorization must apply, with fee, to the Service for work authorization pursuant to § 274a.12(a)(6) of this chapter. K-3/K-4 aliens must apply to the Service for a document evidencing employment authorization pursuant to § 274a.12(a)(9) of this chapter. Employment authorization documents issued to K-3/K-4 aliens may be renewed only upon a showing that the applicant has an application or petition awaiting approval, equivalent to the showing required for an extension of stay pursuant to § 214.2(k)(10) . (Paragraph (k)(9) added 8/14/01; 66 FR 42587 )

Volunteering has to be done under strict limitations of 'ordinarily' volunteer jobs. Animal shelters, feed the homeless, etc.

I realize that it won't be convenient for your business. I'm aware that you may choose to do whatever you need to do. Just be careful about legitimizing this for *others* to do, leading them to think it is OK.

I know it's not legal to go over the speed limit, but I do it sometimes. I'm aware of the consequences and choose to make the gamble. IMO, the stakes are much higher in immigration.

Now That You Are A Permanent Resident

How Do I Remove The Conditions On Permanent Residence Based On Marriage?

Welcome to the United States: A Guide For New Immigrants

Yes, even this last one.. stuff in there that not even your USC knows.....

Here are more links that I love:

Arriving in America, The POE Drill

Dual Citizenship FAQ

Other Fora I Post To:

alt.visa.us.marriage-based http://britishexpats.com/ and www.***removed***.com

censored link = *family based immigration* website

Inertia. Is that the Greek god of 'can't be bothered'?

Met, married, immigrated, naturalized.

I-130 filed Aug02

USC Jul06

No Deje Piedras Sobre El Pavimento!

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