Immigrants and New Residents

For most people moving to the U.S., tax residency begins on the first day of physical presence in the U.S. during the year you meet the Substantial Presence Test or get a green card. There's also a first-year election available in some cases that starts residency earlier. The exact date matters because it determines which income is taxed by the U.S. and which isn't.

Generally no. For the year you become a U.S. tax resident, your pre-arrival income typically isn't subject to U.S. tax. You file as a dual-status alien for that year — nonresident for the pre-arrival portion, resident for the post-arrival portion. Dual-status filings have unique rules (no standard deduction, limited filing status options) and are common but tricky.

Once you're a U.S. tax resident, your foreign accounts come into the U.S. reporting system. FBAR applies if aggregate balances crossed $10,000 at any point. Form 8938 applies at higher thresholds. Foreign mutual funds and ETFs are almost certainly PFICs and need careful treatment. Foreign pensions and retirement accounts vary by country and treaty. The earlier these are reviewed — ideally before you arrive — the more options you have.

Sometimes, and sometimes with U.S. tax consequences. Some foreign retirement plans are recognized as tax-deferred under a treaty (for example, UK SIPPs, Canadian RRSPs). Others are treated as ordinary taxable accounts by the U.S., meaning contributions and growth are currently taxable in the U.S. each year. Treaty review is essential.

Yes — significantly. Foreign corporations you own may require Form 5471 or 8865 filings. Foreign real estate generally isn't reported for ownership but rental income is U.S.-taxable. Foreign real estate held in a company or trust can trigger complex reporting. Pre-arrival planning is the difference between a clean first year and an expensive surprise.

Some countries (Canada, Germany, France, and others) impose exit taxes when residents leave. These payments can sometimes be used as Foreign Tax Credits on your U.S. return in the year of immigration, reducing your U.S. tax liability. Coordinating the timing and documentation is a major planning opportunity for new arrivals.

Ideally 3–6 months before you move, so pre-arrival planning is still possible. Realistically, before your first April 15 as a U.S. tax resident. Most new residents underestimate how much their tax picture changes on day one — getting guidance before filings are due prevents expensive cleanup later.

If you've been in the U.S. for several years without filing FBARs or Form 8938 (and your failure was non-willful), the IRS Streamlined Domestic Offshore Procedures let you come into compliance with reduced penalties. It requires filing three years of amended returns, six years of FBARs, and a 5% Title 26 Miscellaneous Offshore Penalty on the highest aggregate balance of unreported accounts. Still better than the alternative.

If your U.S.-connected income is above the filing threshold (roughly $14,000 for single filers in 2024), yes. Even at low income levels, filing is often valuable because it starts the statute-of-limitations clock, establishes your residency timeline on record, and lets you claim refunds of any U.S. taxes withheld on wages or investments.