Immigration Tax Issues – The New Dynamic Environment Spring 2005

1. Immigration Tax Issues –The New Dynamic EnvironmentSpring 2005 Robert W. Alcorn, MBA, CPA 14881 Quorum Drive Suite 410, LB #9 Dallas, TX 75254-7014 Ph: 972/724-0325, Fax: 972/539-6226 robert@rwalcorncpa.com

2. Introduction Creating an Awareness of Common Tax Problems and Resolutions Pay Particular Attention to Significant Recent & Ongoing Changes

3. General Overview • General Application of U.S. Tax Laws to Non-Citizens • Non-Resident Alien, Dual-Status Alien, & Resident Alien • IRS vs. USCIS – Inter-Agency Communication

4. Working Your Way Through the Income Tax Return – Common Problems and Resolutions • Name • Pick One and Stick With It • Agreement between Documents (Green Card, Birth Certificate, Driver’s License, Social Security Card, etc.) • Social Security Numbers (Real and Imagined) • Get an ITIN • Refunds can be claimed

5. Working Your Way Through the Income Tax Return – Common Problems and Resolutions (cont.) • ITIN’s – Individual Taxpayer Identification Numbers • Identity vs. Alien Status • Documentation Requirements • Time Requirements • Acceptance Agent vs. Certifying Acceptance Agent • Include Original Tax Return with Filing

6. Working Your Way Through the Income Tax Return – Common Problems and Resolutions (cont.) • Filing Status Categories • Single • Married Filing Jointly • Married Filing Separately • Community Property Issues • Head of Household/Married but Living Apart • Union Libre, Common Law Marriage (and the Unfortunate Case of Juan Doe)

7. Working Your Way Through the Income Tax Return – Common Problems and Resolutions (cont.) • Dependents • U.S., Canada, & Mexico • Wages vs. Self-Employment • The SE Tax Trap • Tax Credits • Deductions vs. Credits • Refundable vs. Non-Refundable • Earned Income Credit (Need SS#) • Child Tax Credit (Don’t Need SS#)

8. Statutes of Limitation & Other Restrictions of Time • Original Returns • Amended Returns (and the Fraud Clause) • Claims for Refunds • Obtaining Copies from IRS • Transcripts – Allow 30 days • Requests for Copies – Allow 2 to 4 months

9. Payment Options • Monthly Installment Plan • Offers In Compromise

10. Attorney-Tax Preparer Communications: Doing Your Client a Service and Making Your Job Less Difficult • Competent in Immigration Tax • Knowledgeable About the Immigration Process (Presents Options) • Communicates with the Attorney • Responsive – Sees the Bigger Picture

11. Recent and Unresolved Developments in Immigration Tax Matters • Interagency Communications • ITIN Applications • President Bush’s Proposals Regarding Workers • Tax Return Transcripts and Copies • $150 Filing Fee for Offers in Compromise • Proposal to Apply Non-Resident Alien Tax Status to ITIN Holders • Proposed Changes for Acceptance Agents/ Certifying Acceptance Agents

12. Final Words At this moment, this entire area of tax and immigration law is in the process of going through significant changes and we can only watch as these issues work their way through the process. Anyone involved in this area needs to stay alert for ongoing developments.