Experiences? K1 working for foreign company while waiting AOS

[CodieM 2]

I am working remotely and my money is going into my Australian account of which I will pay taxes there and then I will report that income here when I have to file my US return. I’m now 10 months without an EAD and green card and I told my lawyer I can’t not work anymore it’s driving me insane. He mentioned the above and said if I absolutely have to work then do the above. He also said any illegal work will be dismissed and forgiven given we are on a k1 visa. 

[tony3841 2]

OK, so you weren't working when filing your AOS and EAD requests. That's slightly different from my case, I never stopped working.

[CodieM 2]

I STILL don’t have a work permit and its been year. I need to live so I’m sill working right remotely and going into my Australian account. 

 

Those who who have done this, did you file a W-2 or a W-8BEN?

 

i do work through UpWork

[QuantumAndy 0]

On 13/02/2018 at 2:03 PM, tony3841 said:

OK, so you weren't working when filing your AOS and EAD requests. That's slightly different from my case, I never stopped working.

@tony3841 What did you do in the end? Did you leave the 'Employed until' blank?

[kquyen 48]

I'm on a similar boat. My previous company in NZ just offered me work so I'd be an independent contractor if I did accept the job. I called the NZ Inland Revenue and they said I'm no longer a NZ tax resident and not obligated to pay tax in NZ, so will have to pay in the US. However, I don't know if the moment I pay for income tax in the US I would then appear in the system as earning income..so confusing..Really don't want to risk having my AOS barred but already been waiting 6 months for the EAD...

[A&H2018 146]

2 hours ago, kquyen said:

I'm on a similar boat. My previous company in NZ just offered me work so I'd be an independent contractor if I did accept the job. I called the NZ Inland Revenue and they said I'm no longer a NZ tax resident and not obligated to pay tax in NZ, so will have to pay in the US. However, I don't know if the moment I pay for income tax in the US I would then appear in the system as earning income..so confusing..Really don't want to risk having my AOS barred but already been waiting 6 months for the EAD...

USA has global taxation rules. Even if you paid NZ tax you would have to do USA taxes. 

This is a reason to expedite your EAD tell your congressman.

[kquyen 48]

22 minutes ago, A&H2018 said:

USA has global taxation rules. Even if you paid NZ tax you would have to do USA taxes. 

This is a reason to expedite your EAD tell your congressman.

Thanks for that! However I found the Double Tax Agreement which shows that NZ and USA have an enduring agreement that tax is only paid once to avoid residents from paying taxes twice..the global taxation rules only apply to US Citizen don't it? 

I'll look into expediting...

[geowrian 22,336]

16 minutes ago, kquyen said:

Thanks for that! However I found the Double Tax Agreement which shows that NZ and USA have an enduring agreement that tax is only paid once to avoid residents from paying taxes twice..the global taxation rules only apply to US Citizen don't it? 

I'll look into expediting...

USCs and LPRs (green card holders)*

The Foreign Tax Credit is where you avoid paying double the taxes, IIRC. Basically you pay the higher rate overall, but not both in full.

[A&H2018 146]

The IRS is complicated beast. Global taxation rules apply to "US Persons" or some other random word they use. US Citizen, LPR automatically qualify. Then it depends how many days physically you are in the USA etc...As a K1, AOS process you will become a resident of XYZ state 10 days after entry. So you will be doing US taxes in any scenario. After 183 days you are a "US Person". Welcome to the USA and IRS policies then.

 

Now the scenario depends on the company, if the company pays all your money upfront or not then you may have to do the taxes in New Zealand and USA. If the company pays some taxes to NZ govt then you would need to do a "non-resident" tax return to get back your taxes. If the company pays taxes in NZ, you can use that as foreign deduction on your IRS filings. If the company does not pay taxes, you will need to go by USA taxes.

 

The general rule and easiest way to solve it. Is IRS trusts the company and foreign government, so the company pays NZ taxes you will not have to worry who has higher taxes blah blah blah. Ofcourse at the same time, the NZ govt will ask for a copy of your USA taxes to give you a full refund (else you will get a non-resident refund based around the tax treaty). If you get all the money upfront, you will have then to do USA taxes and depends on federal/state/etc...

 

Bottom line to make this very clear, IRS gets its TAXES end of the day. As a foreign worker (here ful year), as a contractor (here 7 months of a year), as a self-employed (worked in us 3 months at a time for multiple years), as a LPR, and ofcourse as a USC. If you live in the USA, the IRS gets its taxes.

 

Canada/NZ/etc do not have global taxation, they only case if you are a "resident" or "non-resident". The IRS thinks differently.

Edited July 25, 2018 by A&H2018

[Jojo92122 1,924]

21 hours ago, kquyen said:

Thanks for that! However I found the Double Tax Agreement which shows that NZ and USA have an enduring agreement that tax is only paid once to avoid residents from paying taxes twice..the global taxation rules only apply to US Citizen don't it? 

I'll look into expediting...

No.

 

The US taxes based on status and physical presence.  People who must report world-wide income on US tax returns.

 

1.  US citizen.

2.  Green card holders.

3.  Foreigners who meet the substantial presence test

 

[kquyen 48]

17 hours ago, A&H2018 said:

The IRS is complicated beast. Global taxation rules apply to "US Persons" or some other random word they use. US Citizen, LPR automatically qualify. Then it depends how many days physically you are in the USA etc...As a K1, AOS process you will become a resident of XYZ state 10 days after entry. So you will be doing US taxes in any scenario. After 183 days you are a "US Person". Welcome to the USA and IRS policies then.

 

Now the scenario depends on the company, if the company pays all your money upfront or not then you may have to do the taxes in New Zealand and USA. If the company pays some taxes to NZ govt then you would need to do a "non-resident" tax return to get back your taxes. If the company pays taxes in NZ, you can use that as foreign deduction on your IRS filings. If the company does not pay taxes, you will need to go by USA taxes.

 

The general rule and easiest way to solve it. Is IRS trusts the company and foreign government, so the company pays NZ taxes you will not have to worry who has higher taxes blah blah blah. Ofcourse at the same time, the NZ govt will ask for a copy of your USA taxes to give you a full refund (else you will get a non-resident refund based around the tax treaty). If you get all the money upfront, you will have then to do USA taxes and depends on federal/state/etc...

 

Bottom line to make this very clear, IRS gets its TAXES end of the day. As a foreign worker (here ful year), as a contractor (here 7 months of a year), as a self-employed (worked in us 3 months at a time for multiple years), as a LPR, and ofcourse as a USC. If you live in the USA, the IRS gets its taxes.

 

Canada/NZ/etc do not have global taxation, they only case if you are a "resident" or "non-resident". The IRS thinks differently.

Thanks for the detailed explanation!

The company told me I would have to pay my own tax, and when I contacted NZ IRD, they said I'm not considered a 'tax resident' anymore in NZ, as I've been away for over 183 days. So in this case, if I understand correctly, I'll just be paying taxes to the US government. If this tax is income tax though, would it violate my current status given I haven't been granted either EAD or the green card? 

 

Do you know if as an independent contractor in the US would have to register myself as a business ?  In NZ, we had to have an IRD number which is associated with our income tax. For the US IRS, is there an IRS number or something equivalent to that?

[tony3841 2]

On 7/3/2018 at 9:13 AM, QuantumAndy said:

@tony3841 What did you do in the end? Did you leave the 'Employed until' blank?

So I wanted to put "present" but it needed to be a date, so I put the date I signed the form. I'm having my AOS interview soon, fingers crossed!

[tony3841 2]

Green card got approved! The officer didn't even ask about work. Just a few questions about how/when we met and the names of each spouse's parents, stuff like that. And then the long list of questions "are you a terrorist" that I had already answered in the AOS form.

[Nitas_man 3,100]

On 2/13/2017 at 8:15 PM, bob85 said:

So I am currently working for an Australian company and waiting for my K1 to be processed. When I move to the US with the K1 I would like to continue working for my Australian employer during the AOS waiting period. I understand this is a grey area, hence I wanted to hear about real experiences people have had in this situation.

Is there anyone who has done this and now applying for Citizenship and having any problems? Or any issues while filing taxes, etc?

Any info is much appreciated!

Unfortunately you cannot work under any condition after arrival until you have an EAD card permitting you to do so.

 

 

[Nitas_man 3,100]

On 2/12/2018 at 5:42 PM, CodieM said:

I am working remotely and my money is going into my Australian account of which I will pay taxes there and then I will report that income here when I have to file my US return. I’m now 10 months without an EAD and green card and I told my lawyer I can’t not work anymore it’s driving me insane. He mentioned the above and said if I absolutely have to work then do the above. He also said any illegal work will be dismissed and forgiven given we are on a k1 visa. 

So even your lawyer acknowledged that this is illegal