• Obtaining a Tax Identification Number
• Federal Income Taxes
• State Income Taxes
• Property Taxes

Obtaining a Tax Identification Number

After you arrive in the United States with your working visa in hand, but before you begin work, you should apply for a Social Security Number (“SSN”). The SSN is necessary for identification of individual taxpayers at both the federal and New York State tax levels. It is also used for tracking payments into the United States’ social security system either by a taxpayer themselves or by the taxpayer’s employer.

The process of applying for a SSN takes between 6 to 8 weeks. Please go to www.ssa.gov/ssnumber to download the application form: Form SS-5, Social Security Administration Application for a Social Security Card.

You must submit your application in person at a Social Security Administration office in the United States: you cannot apply while you are still overseas. Bring the completed Form SS-5 and at least two forms of identification that prove (1) your age, (2) your identity, and (3) either your U.S. citizenship or your status as an alien lawfully present in the U.S. and authorized to work to any office of the Social Security Administration. To prove your U.S. immigration status, you must show the current U.S. immigration document, I-94, Arrival/Departure Record. To find a Social Security office near you please call the toll free number listed below.

Social Security Administration
Room 430, Federal Building
One Clinton Avenue
Albany, NY 12207
Toll Free Phone: 866-253-9183
Phone: 518-431-4050
URL: http://www.ssa.gov

It is very difficult for persons who do not have work authorization in the United States to obtain an SSN. If your spouse and/or children will reside in the United States, you will probably not be able to obtain a SSN for them, unless they have their own independent work authorization. However, they will still need a number to identify them as unique individuals for tax and credit purposes. For those purposes, you may obtain an IRS Individual Taxpayer Identification Number (ITIN) for each of them. You would also use an ITIN if your spouse and/or children remain abroad and will not reside here, but you still intend to claim them as dependents on your income tax returns.

To obtain an ITIN, go to www.irs.gov and use the search function to locate and download Form W-7 and its instructions. Complete the form and mail it to the address given in the instructions, and you will receive the ITIN in the mail a few weeks later.

You will find that you are frequently asked to provide an SSN as if it were legally required for many financial or credit transactions. In many of these cases, the SSN is not legally required, but it has become the most frequently used identifier of individuals for tax and credit-tracking purposes.

For example, an SSN is requested to open a bank or brokerage account: the SSN is used to ensure compliance with tax and withholding requirements. You may, however, provide either an SSN or an ITIN.

Similarly, an SSN will also be requested to obtain a mortgage or a credit card, or initiate most utility, telephone and other services. It is easiest to simply have the working family member with the SSN to make these applications, although in most instances, an ITIN will be legally sufficient. Other foreigners have found it useful to work with their bank in their home country to establish banking and credit card relationships, or to provide credit information for a mortgage application when an SSN is not available, or will not be available for several weeks.

Federal Income Taxes
If you are a U.S. citizen, or a permanent resident alien (i.e., you hold a “green card”), or if you meet certain residency requirements, you must file Form 1040, U.S. Individual Income Tax Return, and report and pay taxes on your worldwide income. In most cases, if you also pay income tax to a foreign country on income earned outside the U.S., you will receive a credit against your U.S. income tax so you only pay tax on the foreign income once.

If you live abroad but work in the United States temporarily and thus earn income from sources within the U.S., you must file Form 1040-NR, U.S. Nonresident Alien Income Tax Return, to report and pay taxes on your U.S. income only.

In most cases, your U.S. income tax return for each calendar year is due and should be filed by April 15th of the following year. An extension of time to file, but not to pay the tax, can usually be obtained by filing an application for an extension. Most tax forms, related schedules, extension applications, and filing instructions can be downloaded at the IRS website listed above.

However, completing a U.S. income tax return, with its various types of income, adjustments, deductions, exemptions and credits, can be a difficult and intimidating process, even for a long-time U.S. taxpayer. The U.S. tax laws, especially with regard to residency issues, foreign tax matters, and tax credits, are complex and constantly changing, so you may need help in meeting your U.S. tax filing obligations.

For government assistance in applying U.S. tax laws or completing the required forms, call the IRS customer service department, toll-free, at 1-800-TAX-1040 (1-800-829-1040). To obtain assistance from a professional tax advisor, contact a qualified certified public accountant or tax attorney. Seeking professional tax assistance is probably the safest way to ensure that you satisfy your filing requirements without paying too little, or too much, tax. A representative of the Albany-Colonie Regional Chamber of Commerce can help you locate a qualified and reputable tax advisor.

State Income Taxes
If you reside in New York, your state tax filing and payment obligations are generally the same as your U.S. obligations. You must report and pay tax on your worldwide income, and file a tax return (or extension request) and pay the tax for each year by April 15th of the following year. Full-year New York State residents file New York Form IT-201, Resident Income Tax Return. Others file Form IT-203, Nonresident and Part-Year Resident Income Tax Return.

If you live in a neighboring state but work in New York, or if you have earnings from more than one state, you will probably have to file state tax returns in each state. In general, however, you will pay tax on your income only once.

For forms and instructions, or for basic information and tax assistance, go to www.tax.state.ny.us or call a New York State Department of Taxation and Finance customer service representative at 1-800-225-5829. However, state residency laws and multi-state tax issues are no less complex than their federal counterparts, so obtaining the services of a qualified tax professional can be invaluable.

Property Taxes
You will usually only have to pay property taxes if you become a homeowner or if you purchase some type of investment real estate. In general, property taxes are paid in two assessments, one for the school district in which the real estate is situated, and one for the county and city or town in which the property is located. In some cases, depending on where you live, you might pay a small additional assessment to a village, water district, or other locality.

Property taxes are usually computed by applying a fixed rate of tax to the value of the property being assessed. The taxable assessed value is usually the purchase price of the property. It may be increased if you make major improvements to your property, and the property may be reassessed from time to time to reflect increases, or decreases, in property values in general.

Certain exemptions exist which can be used to offset some of the assessed value of your property, decreasing your tax bill. Examples of these exemptions are the STAR exemption, which provides school tax relief for certain residential properties, and the Enhanced STAR program, which provides greater relief to senior citizens. Other exemptions exist for veterans of the U.S. military service, farmers, disabled persons with limited income, and many other targeted groups. However, you must apply for a property tax exemption to receive one. They are not automatic and generally cannot be claimed retroactively, only prospectively.

School taxes are usually assessed at the end of August and payable by September 30th of each year. County and city/town taxes are usually assessed in January and payable by March 31st of each year. If you borrow money to buy your home, you can choose to pay your property taxes, and your homeowners insurance and other costs, by making additional, equal monthly payments with your monthly mortgage payments. Your bank or mortgage company will, usually without charge, deposit the extra payments into an escrow account, and then pay the tax installments and other expenses as they become due. For a complete list of available property tax exemptions, tax levies and rates by municipality, and answers to most other questions about property taxes in New York, go to the New York State Office of Real Property Services website at www.orps.state.ny.us.