biran

Hi all
I am staying in USA in H4 visa dependent on my spouse's H1 Visa. I want to start working for a British Company remotely from my US Home. My salary will be deposited to bank in Britain. Is this legal to do ? Where should I pay my tax ? Are there any consequences ?

Thanks
Biran

Folinskyinla

Hi:

I think you are in a gray area in the immigration laws. I think this would cause an interesting debate among experienced immigration lawyers.

Having said that, I bet I could mount a good defense in any removal proceedings against a charge of violation of status.

On taxes, you would be a "resident" for US tax purposes and that income would be subject to US income taxation laws. I'm not going to comment on UK laws -- I simply don't know.

Martijn

Tax and immigration laws in this are very complex. Add to that that a
lot of this is seperately regulated in tax treaties between the US and
other countries. In the year I immigrated to the US (Marriage based
adjustment of status), I still had income from my own Dutch company. By
the tax treaty between Holland and the US, a person can only be taxed
in one country. However, most of these rules are murky at least.

Even after I liquidated the company, the Dutch taxing agency taxed me
revnue taxes (but not income taxes) for freelance work I did in the US
(on my work permit) for the earlier part of 2006 because they judged
this freelance work was still related to previous work I did as it was
for one of my previous customers of my Dutch company.

None of the accountants and tax specialists I consulted could give me a
definitive answer, and I decided to simply pay the tax revenue although
it falls under US tax laws, and while the US doesn't even know revenue
taxes for IT services. I chose piece of mind over fighting with Dutch
and US tax agencies in murky waters.

Dem rules are complex. The closest I got to an answer on where one
needs to be taxed might also apply to immigration. In cases of
home-workers (or tele-workers), the residence issue is denoted as what
your main domicile is. So, in that respect, you would be working IN the
US. Don't know if the USCIS and IRS here are in conflict or if the
USCIS would regard this work as 'working in the US', but I fear the
latter.

snowbunny

In the past, individuals were usually advised that if they did not have the right to work in the US, they didn't have the right to work while *physically located* in the US. This is probably the "safe" answer, and while I'm sure many do this, it might result in action by USCIS (as MrF has said).

If you report your foreign earnings to the IRS, which you will have to do unless you want to be done for tax evasion, that could arouse suspicion if ever the IRS and USCIS work more closely together to stop immigrants without work visas from working in the US.

Folinskyinla

Hi:

Immigration aside, the use of tax information as confession for other purposes in law enforcement is a very sensitive issue -- Fifth Amendment self-incrimination provisions for starters, policy considerations of promoting filing tax returns since much in the way of US income tax law is dependent upon self-reporting.

As I said, I think it is a gray area. Also, there is a lot of discussion on this in the arena of business visitors -- what is "doing business" and what is "employment." A classic discussion of this involved Canadian truck drivers making cross-border deliveries and pick-ups. [This is one of this things which was addressed in NAFTA if memory serves me correct -- the issue of Mexican truck drivers still is a matter of dispute in California, but deals more with the trucks and not the drivers].