Unauthorized Employment, Back-Taxes and Greencard

[prunenoire]

I’m new to this forum. I have been trying to avoid going to a lawyer, because my fiancé and I don’t have the money to pay for extensive legal advice as we are trying to save up for our wedding and the greencard fees.

My fiancé overstayed the expiration date on his I-94 by six years. It’s an unfortunate situation, but we’re trying to make the best out of it. My fiancé and I are planning to get married in October. Personally it would be sooner, but the church we attend requires pre-marital counseling sessions that will take a couple of months.

As I am a USC I would like to sponsor his greencard. I’ve read up on the entire process and it seems very streamlined, especially because of the fact that it’s a greencard application through marriage; however I have some questions that I can’t get answered through searching on the internet.

My fiancé has been employed at the same company for 2 ½ years. He never filled out any application forms, I-9s or anything, but he receives a 1099-MISC for tax purposes. The 1099 doesn’t show any taxes being deducted from his paycheck and he never filed for a TIN, which I feel like is complicating the situation severely.

After searching the internet I came across this: http://www.boston.com/news/nation/wa...al_immigrants/

1) What does this mean for our situation? Does he receive something like “tax amnesty”?

2) If that is so, does anyone have experience with filing the joint-tax return for the year the marriage was consummated?

3) Isn’t the IRS going to become suspicious, when he suddenly shows up on the radar? They already have two 1099s for 2006 and 2007. Don’t they put one and one together? Or do they go by TIN/SSN and not names (1099 has no TIN/SSN)?

3) Should he file for a TIN before we get married? Or should we just wait until 2009, when he has his SSN and pay for the 2008 taxes after we file the joint-return?

4) Do we have to file back-taxes for 2006 and 2007? Or can we just see it as a fresh start?

5) Does he have to quit his job after we get married, because he doesn’t have his EAD? Or does he just submit his EAD to his employer and legalize his employment?

6) Will his company get into trouble if we indicate on the I-130 and G325A that he is/was employed?

I know these are a lot of questions, but I keep seeing these wishy-washy answers in the internet that really don’t come to the point.

Thanks in advance for any help!

P.S. Sorry if I posted in the wrong forum.

[TheRealCanadian]

Originally Posted by prunenoire

) What does this mean for our situation? Does he receive something like “tax amnesty”?

No. That was never passed. He needs to see a CPA right away.

3) Isn’t the IRS going to become suspicious, when he suddenly shows up on the radar? They already have two 1099s for 2006 and 2007. Don’t they put one and one together? Or do they go by TIN/SSN and not names (1099 has no TIN/SSN)?

They eventually will, and when they come after him it won't be pretty. He needs to proactively get in touch with IRS after consulting with a CPA and determining how much he owes.

4) Do we have to file back-taxes for 2006 and 2007? Or can we just see it as a fresh start?

Absolutely!

Does he have to quit his job after we get married, because he doesn’t have his EAD? Or does he just submit his EAD to his employer and legalize his employment?

He's working illegally already, so I don't see why he needs to quit. He just provides the EAD when he gets it.

Will his company get into trouble if we indicate on the I-130 and G325A that he is/was employed?

Potentially, but that's not your problem. Any trouble that they can get into pales in comparison to the trouble you can get into if you lie on your forms.

[prunenoire]

Thank you for your answer.

Lying was never up to debate.

However, the question was if the US forgives back-taxes of undocumented immigrants. And according to the article and anti-immigration forums, that are pretty pissed at the fact that this provision was dropped, that seems to be the case. But if I am told that is not the case, I will seek advice from a CPA.

[TheRealCanadian]

Originally Posted by prunenoire

However, the question was if the US forgives back-taxes of undocumented immigrants.

It does not, and never has.

And according to the article and anti-immigration forums, that are pretty pissed at the fact that this provision was dropped, that seems to be the case.

Keep in mind that the article is old and the bill died anyways. See a CPA, then talk to the IRS. It's always better to contact IRS than to have them contact you.

[boatbod]

Originally Posted by prunenoire

Thank you for your answer.

Lying was never up to debate.

However, the question was if the US forgives back-taxes of undocumented immigrants. And according to the article and anti-immigration forums, that are pretty pissed at the fact that this provision was dropped, that seems to be the case. But if I am told that is not the case, I will seek advice from a CPA.

Its a moot point because neither of last year's senate or house immigration bills passed and became law.

If the IRS figures out someone owes money, regardless of whether it was for legal work or not, they are going to want their share of it. Under the worst case scenario, your fiance might come to the attention of both the IRS and ICE. If he is deported, he will be subject to a 10yr ban, so I strongly suggest that you get married sooner and get the I-485 paperwork started.

[twopac3]

You will not be able to adjuicate your status if you owe the US government money. No ifs or buts about it.

If he got 1099 for the last couple of years he will definetely owe taxes and probably a lot. 1099s are even tricky since he'll also owe self employment tax (almost 8% extra) because the employer did not pay for their portion of Social security and medicare.

If you are saying you do not have money to consult a lawyer for immigration, paying the taxes are going to be much higher than a few hundred dollars a lawyer would have asked for couple of hour of consultation.

You should expect to pay around 30% of his 1099 wages, plus interest and penalties. Best to get in touch with CPA to see how you can potentially lower your legal tax liability and then backfile your taxes immediately and get into a payment plan with the IRS. The IRS does offer payment plans.

My friend recently had the same situation where he owed $3000 to the IRS from the previous year. At the interview they asked him to pay the IRS before they can do anything. And he got into a payment plan and paid it off and got his greencard now. So if you act now and do the right thing, it will work out.

[austriacus]

The IRS wants money from you for the weirdest things. It even instructs you that if you steal items of value, you must report them as your income. If they want you to report income from stealing, certainly they'll want you to report all your employment income too, no matter if it was derived with or without employment authorization!

On the bright side ... hopefully by reporting the income properly, your fiance will be credited with social security quarters for the previous years that he worked (but I'm not sure if they award them retroactively, maybe you should find out!).

[prunenoire]

Originally Posted by twopac3

You will not be able to adjuicate your status if you owe the US government money. No ifs or buts about it.

The USCIS will not adjust my fiance's status if he owes back taxes? Even if we file the tax forms and negotiate a payment plan with the IRS?

[TheRealCanadian]

Originally Posted by prunenoire

Even if we file the tax forms and negotiate a payment plan with the IRS?

You should be alright in such a circumstance.

[prunenoire]

I know we have to consult a lawyer, but can anyone give me an idea on what they think is reasonable? What are we looking at here:

Option 1)
Get married
File for green card
File back taxes
Get green card

or

Option 2)
File back taxes
Get married
File for green card
Get greencard

Option 3)
Get married
File for green card and back taxes
Get green card


It can get very depressing at times, because we're talking about a ish load of debt and deportation, but we're trying to keep our heads up.

Doesn't the IRS forgive taxes or something like that?

I can't believe that there is NO ONE on this entire board that didn't get married to someone that was out-of-status and didn't pay taxes... Would you people please come out of the woodworks? Not everything is always 'hollywood'.

Oh, and has anyone ever dealt with the free CUNY Immigration Centers lead by Allan Wernick? Any thoughts on that?

Can anyone make a serious recommendation for a law office that deals with immigration and taxes in Manhattan?

I'm not trying to start a advertisement frenzy, but I'm kind of lost right now. I've looked at the Bar Association's website, but that doesn't tell me which lawyer is good and which is not.

Thanks!

[Concerned4us]

IRS forgive taxes? Not likely or we'd all be in line:-)

Look at AILA org website for find a lawyer with immigration specialty in your area. Immigration law is federal paractice so you are not limited to ones where you live.

Check with Catholic Charities or local university law schools for free legal clinics. They may have income limits for assistance.

[austriacus]

prunenoire, don't consider back taxes "debt" as if it's a financial burden that can be forgiven. Think of it as money your fiance was never legally entitled to (and probably should have known that?), and the system is only fair if everyone pays taxes. I'm not sure to what degree USCIS will care about his back taxes (they definitely would care about your taxes if you're his sponsor), but the IRS will definitely care.

Of course, the penalty and interest are going to be steep, and I'll agree with you that can be a big financial burden on top of the taxes owed. (I'm guessing 20% substantial underwithholding penalty and about 7% interest?)

I'm not sure if bankruptcy might release someone from back taxes perhaps. But I doubt you want to go down that route.

[prunenoire]

I understand that it's not real debt, but we owe it, so I use the term that way. The reason why my fiance never paid was because at first he didn't know that it was possible for undocumented immigrants to do that and now we're trying to figure out if and how we would address the problem. I don't want him getting deported over money. It wasn't his fault that his mother decided to bring him over here without proper papers, you know?

We know what we owe and that's fine by us. It's just, when I came across the abovementioned article, I thought there was something that we didn't know about.

I don't go out marrying immigrants everyday, you know? *lol

But thank you to everyone for your help! :-)

[TheRealCanadian]

Originally Posted by austriacus

I'm not sure if bankruptcy might release someone from back taxes perhaps.

No. Taxes and student loans are not forgiven in bankruptcy.

[austriacus]

I don't think bankruptcy is an appropriate option in this case anyway, but just to follow up, this and several other articles claim that your tax debt can be forgiven in bankruptcy in some circumstances (depends on bankruptcy chapter, age of the debt, if fraud was involved, and if a return was timely filed; since no return was filed here I agree it cannot be forgiven even in bankruptcy).

prunenoire, fair enough that your fiance didn't know. Just so you know, there is a 10 year statute of limitations for the IRS to collect a tax debt, but this is 10 years from when they assess the debt, not 10 years from when you owe it (i.e. the 10 years have not even started yet for your fiance!).

You may want to google these terms:
-"currently not collectible" (you owe taxes but don't have to pay at this time)
-"partial payment installment agreement" (where the IRS agrees to a partial payment of the amount if it is paid regularly over time)
-"Offer in Compromise" (this one might sound attractive in your case but would probably be based on hardship, which may be problematic because the affidavit of support will make your income available to your husband).

There may also be the possibility that your fiance will have to pay back taxes but can have the penalty (which will be a substantial amount, especially for the taxes from 6 years ago) waived or reduced. I suppose it also helps that your husband will probably qualify as a resident for tax purposes and as such can take the standard deduction for every year.

So you have a couple of options ... having the tax debt forgiven is not one of them, but certainly you can try to reduce it. If your fiance does end up paying a substantial tax debt, think of it as down payment for the federal public and individual benefits your future permanent resident husband will enjoy for paying taxes.

[bourne24]

Originally Posted by prunenoire

I understand that it's not real debt, but we owe it, so I use the term that way. The reason why my fiance never paid was because at first he didn't know that it was possible for undocumented immigrants to do that and now we're trying to figure out if and how we would address the problem. I don't want him getting deported over money. It wasn't his fault that his mother decided to bring him over here without proper papers, you know?

We know what we owe and that's fine by us. It's just, when I came across the abovementioned article, I thought there was something that we didn't know about.

I don't go out marrying immigrants everyday, you know? *lol

But thank you to everyone for your help! :-)

hi prunenoire.
i want you to calm down both you and your fiancee because you are making the situation complicated while it is not. here is what you need to do, depending from my own experience and based on what my lawyer told me. just to make you feel comfortable i was asking myself the same exact questions and i consulted with my lawyer and he told me what my situation is and what needs to be done.
first i am on AOS based on my citiZen wife, first thing to have in mind is IF EVERY PERSON HAD TO PAY BACK TAXES IN ORDER TO BE GRANTED A GREENCARD I DOUBT ANYBODY WOULD EVER WANT TO APPLY FOR IT ESPECIALLY IF THEY WORKED ILLEGALLY FOR LONG YEARS AND ENDED UP OWING 20 OR 30 THOUSAND DOLLARS.
so my lawyer told me that i wont owe any back taxes, what is important is to file jointly an income tax for the last year. so my advice to you is this:
1-get married
2-dont worry about filing jointly this year since i guess by the time you get married the filing deadline of april 15 will be gone. and anyway even if you get married you dont qualify to file jointly until the next tax season of 2009.
3-tell your husband not to change his behavior, meaning since he never filed let him keep it that way until next year. and if possible make him ask his employer for a w-2 instead of a 1099.
4-about CUNY immigration center, you should use them i heard they are of great help. i am a cuny student myself. if you need more help in paperwork and legal advice, there is an immigration help center in steinway street in astoria queens between 26th ave and astoria boulevard, they do everything for free there.
5-dont think you are off the hook, be prepared next year to still be paying a bunch of money to uncle sam, even if it is only for one year income. especially if your husband gets a 1099 instead of w-2.
6- enjoy your life together and good luck

[envision]

I second what bourne24 said. I was in a similar situation of not paying taxes although without a 1099. I paniced when I saw read USCIS wanted me to bring in w2s for the last 3 years. I went to a CPA and he filed the back taxes, i wanted to cry when I saw all what I owed long story short i ended up not taking them to the irs, went to my interview and it was not mentioned and I was approved . I don't know, maybe it's because I am 245i beneficiary

[austriacus]

Originally Posted by bourne24

IF EVERY PERSON HAD TO PAY BACK TAXES IN ORDER TO BE GRANTED A GREENCARD I DOUBT ANYBODY WOULD EVER WANT TO APPLY FOR IT ESPECIALLY IF THEY WORKED ILLEGALLY FOR LONG YEARS AND ENDED UP OWING 20 OR 30 THOUSAND DOLLARS.

If they didn't feel obligated to pay taxes, why would any person ever decide to work legally in the United States? My wife and I pay the IRS 20 grand every year, and it hasn't inspired me to try to evade taxes. (Call me stupid, but I even report income that was not reported to the IRS.)

Originally Posted by bourne24

so my lawyer told me that i wont owe any back taxes, what is important is to file jointly an income tax for the last year.

Is this a tax professional or immigration lawyer? You can only file jointly for the first year you are married, and it makes no difference if you marry before or after April 15 ... you can file jointly if you were married on the last day of the year for the year you file.

Originally Posted by bourne24

tell your husband not to change his behavior, meaning since he never filed let him keep it that way until next year. and if possible make him ask his employer for a w-2 instead of a 1099.

This will just delay the inevitable, that he'll have to pay the taxes later, and it will cause more penalties and interest later. Once they are married, it may not only be his tax obligation but also hers to pay for his income (esp. if they reside in a community property state).

How do you propose a W-2 lessens his tax burden if he doesn't withhold taxes, as opposed to a 1099? I suppose if he wants to let the Social Security Administration know that he has an income but no withholding, yes.

[austriacus]

Originally Posted by envision

I second what bourne24 said. I was in a similar situation of not paying taxes although without a 1099. I paniced when I saw read USCIS wanted me to bring in w2s for the last 3 years. I went to a CPA and he filed the back taxes, i wanted to cry when I saw all what I owed long story short i ended up not taking them to the irs, went to my interview and it was not mentioned and I was approved . I don't know, maybe it's because I am 245i beneficiary

Maybe it's because the USCIS wants the three years of W-2's from your sponsor, not you? Or am I missing something, is there actually a requirement for those who were employed illegally to present their tax documents? I was not required to present my tax documents for the AOS.

[austriacus]

Let me clarify my position here, I'm not even saying you have to be proactive in filing your back taxes. Let the IRS catch up to you if you want, although your penalties and interest will only keep increasing. Make no mistake about it, this is no different than waiting for a long time to pay your credit card bills, only much worse. If no income was ever reported to the IRS, I suppose you might be off the hook (but probably in a similar predicament to being here illegally ... having to be concerned that it will later come back to haunt you, with even higher penalties and interest).

[envision]

Originally Posted by austriacus

Maybe it's because the USCIS wants the three years of W-2's from your sponsor, not you? Or am I missing something, is there actually a requirement for those who were employed illegally to present their tax documents? I was not required to present my tax documents for the AOS.

yes , although they requested my W-2s for the interview, I was given an RFE for my employer's. I got pretty much the same advice from green card aspirants or permanent residents from message boards which caused unneccessary stress and panic. USCIS is quite aware that many who are illegally employed are unaware that they can pay taxes without a SS# which is why the sole responsibility is on the employer.

[austriacus]

Originally Posted by envision

yes , although they requested my W-2s for the interview, I was given an RFE for my employer's. I got pretty much the same advice from green card aspirants or permanent residents from message boards which caused unneccessary stress and panic. USCIS is quite aware that many who are illegally employed are unaware that they can pay taxes without a SS# which is why the sole responsibility is on the employer.

The responsibility is always with the individual who owes taxes. Your employer doesn't know how much to withhold. You might have six kids and can claim enough exemptions to make your taxable income zero. Or, you might be making a lot of passive income on the side, in which case you need to withhold an additional amount. The responsibility to make sure your withholding is correct is with you. I can tell my employer right now to change my withholding to zero (by claiming a lot of allowances), although in the end I only harm myself by having to pay a penalty if I withhold less than 90% of the tax I owe.

And if I may say, while it's unfortunate if many illegally employed are unaware they can pay taxes without SSN, I hope they also understand that they must pay taxes.

I think it's in the best interest of illegally employed to pay taxes, especially if they do not have a legal immigration status. In my opinion, Americans have been very tolerant of illegal immigration. But, if American citizens or their elected representatives were to find that these individuals tend to not pay taxes, and it raises the tax burden on all legally employed, I'm not sure if this tolerance would last very long.

Let me do a simple calculation here. Let's assume those illegally employed who do not pay taxes are 5% of the workforce and they represent the average taxpayer in terms of tax obligations. Then, I would expect my income tax to be 5% inflated above what it should be if all gainfully employed individuals were to pay tax. This is $1000 tax in my case. Why should I have to pay $1000 more so you don't have to pay your (back) taxes?

In all fairness, I don't want to accuse all who are illegally employed or illegally present of evading taxes; I just wanted to explain what the consequences would be. I'm sure those who evade taxes are a minority. There are probably many more who have too much tax withheld from their paycheck and, because they don't have a SSN, don't file a return and don't get the refund they deserve. I'm grateful for every illegally employed individual who pays taxes, even if it may be an easier choice for them to do otherwise.

[prunenoire]

Ok...

I've been kind of caught up in preparing the wedding. We are taking pre-marital classes from the church, which is fun. And I'm buying my dress next weekend.

bourne24, because you apparently live near or in New York, could you pm me the lawyer that told you that stuff. I mean, we're going to another lawyer (immigration & tax) next week, but two opinions can't hurt.

austricus translates to "österreichischer Bürohansel"

I agree with you to some extent, but don't forget that America built this country on the backs of slaves and illegal immigrants. This country wouldn't even function properly anymore if America would to crackdown on illegal immigrants. This has nothing to do with the tolerance of the American public. It's the greed of US companies and lobbyists that set the pace here. Welcome to America, my friend. And as long as it stands in the interest of the companies to have illegal workers, there will be illegal workers. Where there is demand, there is supply. And there obviously is.

There one flaw with your calculation: Every time you even have a new legal immigrant, doesn't the costs of benefits rise disproportionately to the tax income? So therefore you would have paid $1000 for that illegal immigrant, that couldn't get Medicare or WIC, but let's say now it's $3000, because even though he pays taxes, he's now able to access Medicare, FinAid and governmental assistance programs legally? Go figure.

[Triple Citizen]

Knowing my USC wife, she would have never dated me, let alone marry me, had I been someone illegally present in this country or someone who didn't pay his taxes. From my point of view, I am a known hardliner on this forum. In the interest of you not getting unpleasant feedback, don't ask people to come out of the woodworks
Consult a good CPA and a good attorney. Good luck to you both.
As a footnote, tax evasion does take place in Hollywood too

Originally Posted by prunenoire

I can't believe that there is NO ONE on this entire board that didn't get married to someone that was out-of-status and didn't pay taxes... Would you people please come out of the woodworks? Not everything is always 'hollywood'.

[Concerned4us]

IMO, you need to spend less time and money planning a wedding and more time and money solving your tax and immigration problems.

[prunenoire]

Concerned4us, I totally forgot that you had insight to my bank accounts and time stubs. Thanks for reminding me.

Triple Citizen, thanks for the advice. We have the appointment already. Your wife is commendable for her stance; however, his status never raised any eyebrows amongst my family, friends or myself and yes, we are all law-abiding, tax paying, middle class citizens. But a struggler identifies with a struggler. Whether a USC, legal or illegal. I guess that's something that only occurs in certain ethnic and religious communities. But what do I know?

The Hollywood reference was more referring to the fairly easy situation of legal immigrants.

Everyone is entitled to their opinion. I can't knock a fellow USC for supporting the prosecution of illegal immigrants that don't pay their taxes, even though I against the logic of this capitalistic country, but then on the other hand, if you're a GC holder and whining, I suggest you get your citizenship quickly and vote accordingly. Senator prunenoire can't help you with that one!

[austriacus]

Originally Posted by prunenoire

I agree with you to some extent, but don't forget that America built this country on the backs of slaves and illegal immigrants. This country wouldn't even function properly anymore if America would to crackdown on illegal immigrants. This has nothing to do with the tolerance of the American public. It's the greed of US companies and lobbyists that set the pace here. Welcome to America, my friend. And as long as it stands in the interest of the companies to have illegal workers, there will be illegal workers. Where there is demand, there is supply. And there obviously is.

There one flaw with your calculation: Every time you even have a new legal immigrant, doesn't the costs of benefits rise disproportionately to the tax income? So therefore you would have paid $1000 for that illegal immigrant, that couldn't get Medicare or WIC, but let's say now it's $3000, because even though he pays taxes, he's now able to access Medicare, FinAid and governmental assistance programs legally? Go figure.

Thanks for your response; in my opinion, your arguments are unrelated to federal income tax evasion but I'll respond to them anyway.

While I agree with you that illegal immigration is driven largely by US business needs, keep in mind this is still a democracy and elected leaders will no doubt listen to the concerns of their constituency. If lobbyists wrote the Immigration and Naturalization Act, I don't think it would be as tough on illegal immigration as it is. I'm curious why you think illegal immigration is a necessity for the economic success of this country. If it were truly necessary, I'm sure we'd have the proper laws in place to allow for legal work for the individuals in question. Else, either the citizens of this nation or the lobbyists for special interests are working against the economic interests of this country. If the only purpose of illegal immigration is that it strictly be illegal - perhaps to depress wages below minimum wage or to save on corporate payroll taxes - it will certainly not benefit the large majority of taxpaying individuals and will not make the US prosperous but instead private companies (which may or may not even re-invest into the US economy or be owned by US investors).

About your other comment regarding the tax consequences of legal immigration, first of all let's be clear that not all legal aliens in this country who work and pay income taxes are entitled to the federal benefits you listed, such as government assistance and financial aid. I happened to pay income taxes for nine years in nonimmigrant status while not being eligible for most federal assistance, so you don't have to be illegal to be a taxpayer with limited use of the collected tax receipts (certainly, even as an LPR, lacking the power of vote, you have basically no influence of what your taxes are being used for). That said, I still don't agree with you that future benefits obligations have anything to do with legal vs. illegal immigration. Even everytime an American citizen is born, we create disproportionate obligations against a future generation because in the current system, every generation pays in less than it is entitled to in the future. What this really requires is for the system to be fixed and it's got nothing to do with immigration. I guess it's a technicality but I also want to point out that Medicare, which you mentioned, is financed from payroll taxes (which is the obligation of the employer to withhold), and not federal individual income taxes which we've been discussing here.

[Feb2005]

Originally Posted by prunenoire

Oh, and has anyone ever dealt with the free CUNY Immigration Centers lead by Allan Wernick? Any thoughts on that?

Yes, I've dealt with them once. And I would like to say please by all means spare yourself from that ridiculousness. They are worse than USCIS customer service.

When I went there to get some opinion as to what should I do since it's been year after the green card interview my name check was still pending. The best advice the advisor could come up with was to cancel my application and reapply once my husband became citizen (at that time in 2006 he was a gc holder-and at that time his name check for citizenship was pending for more than good 4 years). I was SO FREAKEN SHOCKED...we just bolted from there.

[prunenoire]

austricus, so what about state taxes? Do we file them in conjunction with the federal taxes?

So what's all this about having back-taxes and not receiving a GC? Is this true or not?

Feb2005, thanks for sharing the experience.

[austriacus]

prunenoire, it might depend on the state. (Some states don't even have a state/local income tax - I live in one of them.) I think you'd probably file a separate state tax return. I'm not sure how aggressive individual states are in collecting back taxes, but the IRS can be pretty persistent in collecting federal back taxes.

I have personally not heard of a law relating back taxes to admissibility for permanent residency. The one I'm aware of is that sponsors have to file back taxes before they can sponsor someone. I'm not sure if some of your fiance's tax burden could legally become yours upon marriage and affecting your situation as a sponsor (I don't think so, but thought I'd mention the possibility).

Certainly, my opinion would be that it would be "doing to the right" to start paying one's back taxes upon being granted the privilege of becoming a permanent resident and if the IRS ever finds out about the back taxes, the sooner you file for them the less you end up paying in penalties and interest.