![](https://images.squarespace-cdn.com/content/v1/61b7bfcf41e4e7495e1a9e38/1639601351158-553791SNOTK9G3A8G02U/unsplash-image-1SP5ZSSeIMw.jpg)
The Ultimate Tax Guide for Australian Expats in the US in 2024
Get back on track with your U.S. Tax Returns.
Uptrend Advisory has provided advice to help Green Card and other visa holders navigate US tax issues, and prepared and filed US tax returns for hundreds of Australian expats.
As Australian expats ourselves, Uptrend Advisory gives you peace of mind and makes US tax compliance effortless and efficient for you. Got a question? Drop us a line and we'll help get your US tax return (back) on track.
What we offer expats
US Tax Return Preparation
Tax Advice for visas, green cards, and more
IRS Amnesty Program Assistance
If you’re one of the many thousands of Australian expats working in the US with a Green Card or a visa such as the E-3, J-1, and H-1B visas—are you aware of your US tax obligations?
For instance, do you know your residency status for tax purposes? And why it’s essential for filing your US tax return correctly?
Or if you only recently realized you’re required to file a US tax return, do you know how to reduce—or avoid—fines?
The following tax guide for Australian expats in the US has been prepared using our extensive knowledge of the US and Australian taxation systems.
Disclaimer: The following tax guide for Australian expats in the US is intended for general information purposes only. Contact us for taxation advice specific to your circumstances.
Search our ultimate expat tax guide:
US Tax Basics for Australian Expats in the US
Issues with US Tax Return Filing
Resident Alien vs. Non-resident Alien Status
How to file a US Tax Return
Expat Tax Services for Australians in the US
US-Australia Tax Treaty
E-3 Visa Holders
Green Card Holders
H-1B Visa Holders
Working in the US as a Freelancer
Dual Citizens
Complex Circumstances
With Dependants
Flexible Spending Account
College Fund
401(K) or IRA
US Tax Basics for Australian Expats in the US.
-
Yes! If you’re an Australian visa holder in the US you’re liable to pay tax on income you earned in the US.
-
Yes! Australian expats working in the US are required to file an annual income tax return with the IRS. This includes E-3, H-1B, and J-1, and Green Card visa holders.
-
Generally, the same as a US citizen.
This includes federal, state, and local taxes. It also includes Federal Insurance Contributions Act tax (FICA) which covers Social Security and Medicare taxes. Some visa holders, including the J-1 visa holders, may be exempt from FICA tax under certain circumstances. However for most Australian expats working in the US, there are no US tax exemptions. -
Your federal US income taxes are determined by marginal rates and standard deductions set annually by the IRS.
Your state and local taxes depend on where you live and how much you earn.
Social security and medicare tax rates are set by the IRS.Finally, the exemptions you declared on your W-4 Form, e.g., for dependents, affect the tax withheld from your salary or wages. You typically fill out a W-4 when you start a new job. You can also update it when you’ve had a change in circumstances. However make sure you don’t claim more allowances than you’re entitled to, otherwise you may end up with a US tax shortfall after your tax return is processed.
-
The due date for filing your US tax return is usually April 15th for the financial year ending the previous calendar year. With an IRS extension request your due date is October 15th. However if you owe US taxes it won’t extend your payment deadline and you must still pay by April 15th.
-
The Internal Revenue Service (IRS) is the US Department of Treasury agency responsible for assessing and collecting US taxes.
Issues with US Tax Return Filing for Australian Expats in the US
Help! What should I do? I’m an Australian expat on an E-3, J-1, H-1B, or Green Card and:
I’m late filing my US tax return.
I haven’t filed any US tax returns because I didn’t realize I needed to.
The IRS has notified me that my previous US tax return had errors and I now owe extra US tax.
The IRS sent me an inquiry and I need to resubmit my tax return.
I think the last US tax return I filed was incorrect or missing information.
I’m not sure if my last US tax return was filed on time (or at all).
Firstly, the IRS has procedures in place to help resolve common difficulties. For instance, if you think you’ll be late filing your tax return, you can apply to the IRS for an extension. Also, if you haven’t filed your taxes in three or more years, you may be eligible for the IRS Streamlined Procedures, which is an amnesty program that can reduce or eliminate your penalties.
Secondly, it’s also advisable to seek specialist help from a US tax professional who’s knowledgeable on taxation for Australian visa holders in the US.
As Australian expat tax accountants, Uptrend Advisory has helped hundreds of Australian E-3, J-1, H-1B, and Green Card holders successfully resolve IRS inquiries. As Aussies expats in the US ourselves, we understand how stressful it can be when you’re far away from home with the added worry of getting (back) on track with your US tax returns.
Uptrend Advisory are specialists in American tax compliance and how it applies to Australian expats in the US. We’re here to help. Get in touch and we’ll advise you on the best way to resolve your concern so that you’re compliant with your US taxation requirements.
Resident Alien vs. Non-resident Alien Status
-
As an Australian visa holder in the US, you have a residency status based on your visa. For instance, a Green Card holder is an immigrant alien whereas E-3, J-1, and H-1B visa holders are non-immigrant aliens.
In addition, the IRS classifies foreigners with a residency status for tax purposes.
For most visa holders, you’re considered to be a non-resident alien for tax purposes unless you have a Green Card or you meet the substantial presence test. This test determines if you were physically present in the US for a “substantial period” as defined by the test criteria. Certain visas are exempt from the substantial presence test for a set number of years including the J-1 visa.
So this means you can be an Australian expat in the US who’s a non-resident alien for immigration purposes while also being classified by the IRS as a resident alien for tax purposes. And don’t forget, you still need to file a US tax return regardless but there are different forms to file depending on your tax residency status. -
You’re a resident alien for tax purposes if you have a Green Card or you meet the substantial presence test.
-
You should seek the advice of a taxation professional who can review your specific circumstances. As a US tax service for Australian expats living in the USA, Uptrend Advisory has helped Australian expats affected by Covid travel restrictions with their US tax filing.
How to file a US Tax Return as an Australian Expat
-
Yes! You need a Social Security Number (SSN) to file your US tax return electronically. If you don’t have an SSN you can apply for an Individual Taxpayer Identification Number (ITIN).
-
If you’re an employee, you also need a Form W-2 to file your US tax return. Your US employer is required to send your W-2 by January 31. It shows your wage and salary details and the amount of taxes withheld from your paycheck for the calendar year. If you’re an independent contractor or self-employed, a Form 1099-MISC is used instead.
If you’re an E-3 visa holder, it’s a requirement that you’re employed with a salary or wage. So, for Australian expats with E-3 visas their employer income statement should only be in the form of a W-2 form.
If you receive income from other sources, such as interest, dividends, and capital gains, you’re issued Form 1099 income statements from financial institutions e.g., banks, stock brokerage accounts. -
The specific IRS forms you need to file depend on your visa, your employment classification, and other factors.
-
Australian expats in the US are required to report foreign financial accounts through the Foreign Bank and Financial Accounts Report (FBAR). If you had a total of over US$10,000 aggregated across all your foreign accounts at any time during the tax year, you need to file an FBAR. Be aware, you must list all foreign accounts on your FBAR, even zero balance accounts. That’s because the overall total of your foreign accounts met the $10,000 threshold. And be sure to include all foreign accounts, not just bank accounts, such as stock portfolios, shares, and other assets. A common mistake expats make is to only list bank accounts or fail to list zero balance accounts. But it’s vitally important to prepare your FBAR correctly otherwise the IRS can impose severe penalties. Drop us a line if you need help preparing your FBAR.
-
You can file your US tax return yourself by downloading the IRS forms. Or you can file electronically using IRS software or commercial US tax preparation software such as Turbo Tax. There are also tax services such as a tax accountant or an Australian expat tax service to prepare and electronically file your US tax return.
Uptrend Advisory is an Australian expat tax service based in the US. Founder and Managing Director, Jason Stoch, CPA, CA is an Australian expat with an extensive knowledge of the US and Australian taxation systems. Jason and his team have helped hundreds of expats in the US for more than 10 years navigate through the complexities of the US and Australian taxation systems, efficiently and compliantly. -
You can certainly prepare your US tax return yourself with information from the IRS if you’re familiar with US taxations requirements and the IRS tax return filing processes. However be aware, if you file an incorrect US tax return or you miss the US tax filing deadline, the IRS can impose punitive penalties and you might end up paying more tax in the US. Or even if your US tax return is compliant, you may even miss out on optimal outcomes for your circumstances.
Expat Tax Services for Australians in the US
-
If any of the following apply, then an Australian expat tax service specializing in US taxes for visa holders is a smart option:
Your situation is complicated,
You’re not sure about your tax residency status,
You’re not familiar with Australian expat tax for visa holders in the US,
You’ve had a previous IRS inquiry or previous issues filing your US tax return, or
You’re a busy Australian expat in the US who wants the convenience and peace of mind of an expat tax service to prepare and file your US tax return.
A good tax service for Australian expats living in the US will ensure your US tax return is accurate, filed on time, and that you pay the correct amount of US tax. Make sure you find someone familiar with US tax requirements for Australian visa holders, such as an Australian expat tax accountant who can give you qualified tax advice. -
Find a US tax service that’s suitable for Australian expats. Look for a professional who’s experienced and knowledgeable in US tax requirements for Australians in the US.
A good Australian expat tax accountant should be aware of US tax requirements specific to your visa including E-3, J-1, H-1B visas and Green Cards. Plus, they should be easily reachable, especially during tax time when you need frequent contact and reassurance that your US tax return is being properly prepared and filed on time.
And, if you’re in a “Help! Something’s gone wrong!” type situation, a good expat tax accountant will be responsive and know how to assist you with IRS inquiries. Finally as any Australian expat in the US will tell you, being friendly and approachable is a must.
As a US tax service for Australian expats living in the USA, Uptrend Advisory has helped hundreds of Australian expats for more than 10 years with their US tax filing and offered tax advice to help Australian visa holders navigate their US taxation.
We have comprehensive knowledge of US tax legislation and how it applies to Australian expats who are E-3, J-1, H-1B, and Green Card holders. Drop us a line and let us know what you need help with.
US-Australia Tax Treaty
-
At the Federal level, generally, No.
That’s because there’s a US-Australia Tax Treaty which means you’re able to leverage the tax paid to the ATO on your Federal return to offset what the IRS calculates. As Australia’s tax rates are typically higher than the IRS’s, this typically results in no additional US tax owing. But, you still need to declare Australian sources of income on your Australian tax return.
However, when it comes to State taxes, you might get taxed on Australian sourced income, depending on which US state you live in, including New York and California. That’s because at the state level, some US states don’t abide by the US-Australia Tax Treaty for assessing state taxes.
Drop us a line, if you’re an Australian expat who’s unsure of your US tax obligations around Australian sourced income. In the event you’re taxed on Australian sourced income, we can help identify if you’re eligible to claim foreign tax credits. -
Yes, but under the US-Australia Tax Treaty, you’re exempt from paying tax twice. To claim the IRS Foreign Tax Credit you need to file Form 8833 and Form 1116.
-
No. That’s due to the US-Australia Tax Treaty which means you won’t be taxed twice.
But you need to claim the IRS Foreign Tax Credit by filing Form 8833 and Form 1116 when submitting your US tax return. And also, you need to file an Australian tax return and include your Australian sourced income so that you can leverage credits for your US tax return.
Plus keep in mind, when it comes to State taxes, you might get taxed on Australian sourced income, depending on which US state you live in, including New York and California. That’s because at the state level, some US states don’t abide by the US-Australia Tax Treaty for allowing tax credits.
If you’re unsure how to report Australian income sources, consult a US tax professional who’s knowledgeable in the US-Australia Tax Treaty. -
Superannuation taxes for Australian expats is complicated because there’s no equivalent of superannuation in the US. The IRS doesn’t have clear superannuation tax guidelines for US tax returns. It's a grey area and there are often conflicting views about reporting super on US tax returns even amongst tax professionals.
But there are consequences for misreporting your US tax return. So it’s advisable to consult a US tax professional who is knowledgeable on how to report your superannuation for US tax filing requirements.
As Australian expat tax accountants, Uptrend Advisory can review your specific situation and advise you further. Drop us a line. -
Generally, yes. If you’re an Australian resident for tax purposes or you’re earning Australian income you need to file an Australian tax return. But, be aware if you have a HECS/HELP debt, you still need to declare any worldwide income to the ATO, regardless of your tax residency status.
-
Drop us a line and let us know your situation. Even though Uptrend Advisory does not offer Australian tax preparation services, we can put you in touch with a knowledgeable Australian tax professional in our network.
-
This is definitely an area where you should consult a specialist such as an Australian tax lawyer. That’s because there are Australian tax rules around paying capital gains tax on investment properties that specifically impact Australian expat tax obligations. Also, the Australian tax legislation is constantly under review and varies by state. So it’s essential to get professional advice to understand the tax implications of selling property as an Australian expat.
US Taxes For E-3 Visa Holders
-
Yes! As an Australian E-3 visa holder you have to pay tax in the US and file an annual US tax return with the IRS.
-
Great questions! Uptrend Advisory specializes in E-3 tax services for Australian expats in the US. Learn more about US tax filing requirements and how to do US taxes as an E-3 visa holder.
US Taxes For Green Card Holders
-
Yes! As a Green Card holder you have to pay tax in the US and file an annual US tax return with the IRS.
-
Great questions! Uptrend Advisory specializes in Green Card tax services for Australian expats in the US. Learn more about US tax filing requirements and how to do US taxes as a Green Card holder.
US Taxes For H-1B Visa Holders
-
Yes! As an Australian H-1B visa holder you have to pay tax in the US and file an annual US tax return with the IRS.
-
Great questions! Uptrend Advisory specializes in H-1B tax services for Australian expats in the US. Learn more about US tax filing requirements and how to do US taxes as an H-1B visa holder.
US Taxes For Australian Expats Working in the US as a Freelancer
-
If you’re earning income in the US through freelance work, you’re required to file a US tax return. Firstly though it’s critical you’re correctly classified according to IRS worker classifications to determine if you’re providing service as an employee or an independent contractor. Your classification affects which IRS forms you need to file. But if you’re not sure, drop us a line.
If you’re a Green Card holder performing freelance work, learn more about US taxation requirements as a Green Card holder.
US Taxes For Australian Expats in the US who are Dual Citizens
-
If you’re earning income in the US, you’re required to file a US income tax return. But as a dual citizen you also have additional iRS reporting requirements. You should seek specialist advice from a specialist tax service with knowledge on Australian and US taxation for dual citizens.
As Australian expat tax accountants, Uptrend Advisory specializes in US tax services for Australian E-3, H-1B, and J-1 visa, and Green Card holders. Drop us a line and we can refer you to a specialist within our network of knowledgeable tax service professionals.
US Taxes For Australian Expats in the US with Complex Circumstances
As an Australian working in the US, how do I handle US tax filing if my situation is complicated because:
I have a financial life both in the US and Australia.
I own real estate both in the US and Australia.
My US spouse and I got divorced.
My US spouse and I got divorced and we have children together.
I’ve worked in other countries in addition to the US and Australia.
I operate a small business in the US.
I have no idea how to report my US income to the IRS or the ATO.
Drop us a line and let us know your question. As Australian expat taxation accountants, Uptrend Advisory specializes in US tax services and US tax filing for Australian E-3, H-1B, and J-1 visa, and Green Card holders.
US Taxes For Australian Expats Working in the US with Dependants
I’m an Australian with children working in the US. What do I need to know about tax filing in the US?
You may be able to claim a child tax credit for dependent children on your US tax return. You need a Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) for your child. If your child was born in the US they’re automatically a US citizen and are eligible for a SSN. Otherwise you need to apply for an ITIN.
To claim the credit you need to file your tax return according to the guidelines specified by the IRS.
Uptrend Advisory has helped hundreds of Australian expats in the US successfully claim the child tax credit when filing their US tax return. Drop us a line and we’ll put you on the right track.
You should also review your exemptions on your W-4 Form as it may benefit you to claim the dependent exemption.
US Taxes For Australian Expats in the US with a Flexible Spending Account
I’m an Australian working in the US with a Flexible Spending Arrangement (FSA). Do I need to report this on my US tax return?
Generally, you don’t have to report FSA contributions on your US tax return. However, there are US tax reporting requirements for some types of medical savings accounts and health savings accounts. So it’s important to be sure about the US tax reporting obligations associated with your plan.
Drop us a line if you have a question about your FSA and US tax filing. As a US tax service for Australian expats living in the US, Uptrend Advisory has helped Australian expats with an FSA with their US tax filing.
US Taxes For Australian Expats in the US with a College Fund
I’m an Australian working in the US with a college fund. Do I need to report this on my US tax return?
For a 529 plan there are generally no reporting requirements on your federal US tax return. However some states offer credits or deductions for a 529 plan so you may benefit from reporting contributions on your state income tax return.
Drop us a line if you have a question about 529 plans and US tax filing. As Australian expat tax accountants, Uptrend Advisory specializes in tax filing for Australian expats in the US and we’ve helped Australian expats with a 529 plan with their US tax filing.
US Taxes For Australian Expats in the US with a 401(K) or IRA
I’m an Australian working in the US with a 401(k) or IRA. Do I need to report this on my US tax return?
Generally, you can claim a deduction for 401(k) contributions. However if you leave a US employer and cash out your 401(k) you may be subject to taxes or penalties. If you fully rollover your 401(k) into an IRA you generally won’t be subject to US taxes. But conditions apply so it’s advisable to consult a US tax specialist if you’re in this situation.
Drop us a line if you have a question about your 401(k) or IRA and US tax filing. As a US taxation service for Australian expats living in the USA, Uptrend Advisory has helped Australian expats with an IRA or 401 (k).