Green Card Holder Tax Services
A green card makes you a US person taxed on worldwide income — just like a citizen. We handle your 1040, FBAR, first-year dual-status returns, streamlined catch-up, and exit tax if you ever give the card back.
Green Card Holders We Serve
Whether you just received your card and live in the US, moved abroad but never formally abandoned it, or are ready to hand it back after years as a permanent resident — we have handled your exact situation before.
Green Card Holders Living in the US
You just received your green card and were surprised to learn the IRS now taxes your worldwide income — including foreign salary, rental income, investment gains, and pensions — from the very first day of residency. You may owe a first-year dual-status return, and your home-country bank accounts likely trigger FBAR and FATCA reporting. Many clients also worry that a tax mistake could jeopardize a future naturalization application. We get you filed correctly and keep your record clean.
Green Card Holders Living Abroad
You moved out of the United States — sometimes years ago — but never filed Form I-407 to formally abandon your green card. That is the costly misunderstanding: you remain a full US tax resident and must keep filing Form 1040 on your worldwide income and FBARs on your foreign accounts, even while living overseas. Letting the physical card lapse does not end your tax obligation. Most clients in this situation need multi-year catch-up filing to become compliant.
Long-Term Residents Abandoning the Card (Exit Tax)
You have decided to give up your green card and surrender it with Form I-407. If you are a Long-Term Resident — someone who held a green card in at least 8 of the last 15 tax years — you may be treated as a covered expatriate under IRC Section 877A, triggering a mark-to-market exit tax on the deemed sale of your worldwide assets. Form 8854 is required. We model your exposure in advance and structure the exit to minimize or avoid covered-expatriate status where possible.
Why Green Card Holder Tax Is Complex
A green card is not just an immigration document — it makes you a US taxpayer on your worldwide income, with reporting obligations that most new residents never see coming and that do not end just because you move away.
Worldwide Income From Day One
A green card holder is a 'US person' for tax purposes and is taxed exactly like a US citizen: on worldwide income, regardless of where it is earned or where you live. Your foreign salary, self-employment income, rental properties, dividends, interest, capital gains, and even foreign pensions are all reportable on Form 1040. This is often a shock to new lawful permanent residents who assumed only US-source income mattered. Foreign tax credits (Form 1116) and the foreign earned income exclusion can reduce double taxation, but the income must still be reported.
Substantial Presence and First-Year Dual-Status Returns
In the year you receive your green card, you are frequently a dual-status alien — a nonresident for part of the year and a resident for the rest. Your US residency starting date is generally the first day you are physically present in the US as a lawful permanent resident, and the Substantial Presence Test can also independently establish residency based on days present. A dual-status return splits the year: only US-source income is taxed for the nonresident portion, while worldwide income is taxed from the residency start date forward. These returns have special rules — no standard deduction, restricted filing status — and are easy to get wrong.
FBAR and FATCA on Home-Country Accounts
If the aggregate value of your non-US financial accounts exceeds $10,000 at any point during the year, you must file FinCEN Form 114 (the FBAR). This covers checking and savings accounts, foreign brokerage and pension accounts, and certain foreign life insurance in your home country. Separately, if your foreign financial assets exceed the Form 8938 (FATCA) thresholds, that form is required with your 1040. Penalties for non-filing start at $10,000 per year per violation and stack across years — yet these are exactly the accounts new green card holders forget to report.
The I-407 Misconception (Letting the Card Expire)
This is the single most expensive misunderstanding we see. Your US tax residency does NOT end simply because you moved abroad or because the physical green card expired. Under US tax law you remain a lawful permanent resident — and a US tax resident filing Form 1040 and FBARs every year — until one of two things happens: you formally abandon the card by filing Form I-407 with USCIS, or you take a treaty tiebreaker position (Form 8833) claiming residency in a treaty-partner country. Critically, taking that treaty position can itself trigger the expatriation rules for long-term residents. Simply doing nothing leaves you liable for years of unfiled US returns.
The Exit Tax for Long-Term Residents
When a Long-Term Resident (green card in 8 of the last 15 years) abandons the card via Form I-407 or takes a treaty tiebreaker position, IRC Section 877A can impose a mark-to-market 'exit tax.' You are treated as if you sold all of your worldwide assets at fair market value the day before expatriation, and the net gain above an annual exclusion amount is taxed. You become a covered expatriate if you fail any of three tests: net worth of $2 million or more, a five-year average annual net income tax liability above an inflation-adjusted threshold, or failure to certify five years of tax compliance on Form 8854. Planning before you surrender the card is essential.
Streamlined Catch-Up for Delinquent Filers
Many green card holders — especially those living abroad — discover they were required to file US returns and FBARs for years they never touched. The IRS Streamlined Filing Compliance Procedures offer a path back into compliance for taxpayers whose failure to file was non-willful. Qualifying filers submit three years of amended or delinquent returns and six years of FBARs, with reduced or zero penalties for those who meet the non-residency requirements. Acting before the IRS contacts you is what preserves access to these favorable procedures.
Foreign Pensions, PFICs, and Trust Reporting
Investments that are perfectly normal in your home country can be tax traps in the US. Foreign mutual funds and pooled investment products are typically classified as PFICs (Passive Foreign Investment Companies), one of the most punitive regimes in the Internal Revenue Code, requiring Form 8621. Foreign retirement plans may or may not be treaty-protected. Certain foreign pensions, savings vehicles, and family arrangements are treated as foreign trusts, triggering Forms 3520 and 3520-A. We identify these exposures before they become penalty events.
Naturalization and Good Moral Character
For green card holders planning to naturalize, tax compliance is not just a financial issue — it is an immigration one. USCIS asks whether you have filed required federal, state, and local tax returns, and unresolved tax debts or unfiled returns can affect the good moral character determination on Form N-400. Setting up an installment agreement with the IRS and getting current on filings protects your path to citizenship. We coordinate a clean compliance record so your tax history supports, rather than complicates, your application.
How We Help Green Card Holders
From your first year with the card through annual compliance and an eventual clean exit, we cover every stage of the green card holder tax lifecycle.
Green Card Holder Form 1040 + FBAR Preparation
We prepare your annual US resident return reporting worldwide income, with foreign tax credits (Form 1116) and the foreign earned income exclusion applied where they produce the best result. We file your FinCEN Form 114 (FBAR) covering every home-country account, and Form 8938 (FATCA) when your foreign assets exceed the thresholds. This is the core compliance package for lawful permanent residents living in the US or abroad.
First-Year Dual-Status Returns
The year you receive your green card is the trickiest to file. We determine your US residency starting date, apply the Substantial Presence Test, and split the year into its nonresident and resident portions on a dual-status return. We advise on elections — such as the first-year choice or filing jointly as a full-year resident — that can produce a lower overall tax, and we make sure the special dual-status rules (no standard deduction, limited filing status) are handled correctly.
Streamlined Filing Compliance Procedures
If you fell behind on US returns and FBARs, we bring you current through the IRS Streamlined Filing Compliance Procedures for non-willful taxpayers. We prepare three years of returns and six years of FBARs as a single catch-up engagement, draft the required non-willful certification statement, and advise on whether you qualify for the Streamlined Foreign Offshore (zero-penalty) or Domestic track based on your residency and days present.
Green Card Abandonment and I-407 Planning
Before you file Form I-407 or take a treaty tiebreaker position, we model whether you are a Long-Term Resident and whether the abandonment would make you a covered expatriate under IRC Section 877A. We identify the exact year the 8-of-15 clock is met, calculate your net worth and average tax-liability exposure, and time the surrender to minimize or avoid the exit tax where the facts allow.
Exit Tax and Form 8854 Preparation
For Long-Term Residents who are covered expatriates, we compute the mark-to-market deemed sale of your worldwide assets under IRC Section 877A, apply the annual gain exclusion, and address the special rules for deferred compensation, specified tax-deferred accounts, and non-grantor trusts. We prepare Form 8854 (the Initial and Annual Expatriation Statement) certifying five years of tax compliance, which is required to complete your expatriation cleanly.
FBAR, FATCA, and PFIC Reporting
We handle the full information-return landscape that green card holders face: FinCEN Form 114 (FBAR) for foreign accounts, Form 8938 (FATCA) for foreign financial assets, Form 8621 for PFIC mutual funds and pooled investments, and Forms 3520/3520-A for foreign trusts, gifts, and inheritances. We calculate maximum account values in USD using the correct Treasury exchange rates and keep every filing consistent with your tax return.
Foreign Pension and Investment Analysis
Your home-country retirement plan, savings vehicles, and investment funds all carry US tax consequences that vary by country and treaty. We analyze whether a foreign pension is treaty-protected, whether your foreign mutual funds are PFICs, and how to restructure holdings to avoid the most punitive treatment. For clients still contributing abroad, we advise on which vehicles remain US-compliant.
Naturalization Tax Compliance Support
If you are preparing to apply for US citizenship, we make sure your tax record supports your Form N-400. We confirm all required returns are filed, resolve outstanding balances through IRS installment agreements where needed, and provide documentation of your compliance history so the good moral character review goes smoothly.
Cross-Border Coordination
Many green card holders have obligations in a second country as well. We coordinate your US filing with your home-country tax position, apply the relevant income tax treaty, and prevent double taxation through the foreign tax credit. For clients moving between the US and Canada specifically, we file both returns together as a single coordinated engagement.
Green Card Holder Tax Packages
Flat-fee pricing with no surprises. Every package includes unlimited communication with your assigned tax advisor.
Green Card Holder Return
Form 1040 (worldwide income) + FBAR
- US Form 1040 reporting worldwide income
- Foreign Tax Credit optimization (Form 1116)
- Foreign earned income exclusion analysis
- FBAR (FinCEN Form 114) filing
- Form 8938 (FATCA) when required
- USD conversion of foreign income
- E-file to the IRS
First-Year / Dual-Status Return
The year you received your green card
- Dual-status alien return preparation
- US residency starting date determination
- Substantial Presence Test analysis
- First-year choice / joint election evaluation
- Split-year worldwide vs. US-source income
- FBAR + FATCA for the transition year
- Foreign pension and account review
Catch-Up or Exit-Tax Planning
Streamlined filing or Form 8854 exit tax
- Streamlined Filing Compliance Procedures
- 3 years of returns + 6 years of FBARs
- Non-willful certification statement
- Long-Term Resident / covered expatriate testing
- IRC Section 877A mark-to-market modeling
- Form 8854 expatriation statement
- Dedicated advisor for multi-year engagements
Specialized Services for US Persons Abroad
Green card tax rarely stands alone. Explore the related engagements we frequently pair with a lawful permanent resident’s filing.
Streamlined Filing Procedures
Behind on years of US returns and FBARs? Our Streamlined Filing service brings non-willful green card holders back into compliance with three years of returns, six years of FBARs, and a proper non-willful certification.
Renunciation and Exit Tax
Giving up your green card or citizenship? We handle the IRC Section 877A exit tax, covered-expatriate testing, and Form 8854 preparation for Long-Term Residents surrendering their status.
FBAR Filing
Every green card holder with foreign accounts over $10,000 must file the FBAR. We prepare FinCEN Form 114 and coordinate it with your 1040 and FATCA reporting.
US-Canada Cross-Border Tax
Green card holder with Canadian ties? We file your US 1040 and Canadian T1 together, optimized under the treaty to eliminate double taxation.
Expat Tax Services
Living abroad as a green card holder? Our expat practice keeps US persons overseas compliant with the 1040, FBAR, FATCA, and foreign tax credits.
How Our Green Card Tax Process Works
From initial consultation to e-filing — we manage the entire engagement, whether it is a single year or a multi-year catch-up.
Free Consultation
We assess your residency status, determine which years you must file, and identify whether the Substantial Presence Test, dual-status rules, or exit tax apply to you.
Gather Documents
We provide a customized checklist — foreign and US income, bank balances for FBAR, pension and investment statements, and your green card approval or I-407 dates.
Preparation and Analysis
We prepare your 1040, FBAR, and any required information returns, optimize the foreign tax credit, and run any dual-status or covered-expatriate calculations.
Review and E-File
You review everything with your advisor. Once approved, we e-file to the IRS, submit your FBAR to FinCEN, and provide copies for your records.
Green Card Holder Tax FAQs
Answers to the most common questions from lawful permanent residents — new arrivals, those living abroad, and those preparing to give up the card.
Harsh Agarwal, EA · IRS Enrolled Agent
Reviewed for accuracy by Zenith Financial Advisors
Ready to Get Started?
Free 15-minute call with a licensed Enrolled Agent who specializes in your exact situation. No obligation.
Need immediate assistance? Call us at +1 (409) 916-8209