Not Born in the USA

Today Mike from Australia has a dilemma – I am a dual US / Australian citizen (Had US parents who immigrated to Australia prior to my birth) who has lived and worked in Australia his entire life.

Recently, an opportunity has arisen whereby I’ll be able to live and work in the US for a minimum of 3 years.

However, I’m 24 years old and have never filed a US tax return, since all my income up until this point has been purely from an Australian source. I’ve never even lived in the US for any period of time, let alone worked there at all, or even filed for a Social Security Number (In other words, all I have is my US Passport).

Do you have any idea what my tax obligations will be? Will I be hassled when I apply for my SSN? Will I be required to lodge back tax returns for the last [x] years?


Dear Mike,

You’re 24 years old.

How long can you possibly have been earning a serious income?

Have you ever earned more than $US 70,000 per year?
Have you ever run your own business – at a profit?
Have you paid taxes to Australia on your income?
Think about the answers to these questions.

Essentially, if you’ve always been in someone else’s employ, you’re entitled to exclude $50,000 – $70,000 and up per year over the last 8-10 years.

So, if they absolutely insisted you file a tax return, you could – and would owe nothing due to the foreign income exclusion.

If you were ever self-employed, and earning a profit, on the other hand, you might have to file tax returns just to pay Social Security taxes on the profits, not income taxes. Those might be hefty, depending on your profits.

The best way to find out where you stand is to go to the American Embassy and get started
on getting your Social Security application filed.

Or see if you can do it online…. http://www.ssa.gov/pubs/10002.html

I wouldn’t worry too much about IRS bugging you, though. I would just file the first tax return when I started working in the US.

You’ll find answers to all your tax problems – and all kinds of tax information, when you need it, where? At TaxMama.com

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