3 Tax Tips for G-4 Visa Holders
#1. G-4 Visa Holders May Be Required to Pay 30% Capital Gains Tax
Generally, nonresidents of the United States are not taxable on capital gains recognized from the sale of stocks, bonds and mutual funds. However, there is a special rule that applies to G-4 visa holder nonresidents. If a G-4 visa holder is physically present in the U.S. for 183 days or more during the calendar year, he/she is taxable at a flat 30% tax rate on their worldwide capital gains from the sale of securities. This sometimes results in double taxation if a foreign country also taxes these capital gains.
#2. Filing Status: G-4 Visa Holder Married to their G-4 Dependent Spouse
G-4 visa holder employees of International Organizations (I/Os) are not allowed to file a joint income tax return with their G-4 dependent spouses because both are considered non-residents. Married nonresidents who have a tax filing requirement must each file a U.S. Form 1040NR (not Form 1040) with filing status “Married Nonresident Alien”.
#3. Filing Status: G-4 Visa Holders Married to U.S. Persons
G-4 visa holder employees of International Organizations are allowed to file a Form 1040 income tax returns as “Married FilingJoint” if his/her spouse is a U.S. citizen or green card holder. However, since only two U.S. tax residents may file a joint income tax return, the law provides that an election (called the 6013(g) election) is required in order to elect for the G-4 nonresident to be a U.S. tax resident. If such election is not made and the spouses file jointly, the joint tax return may be deemed invalid.
Please contact Dale Mason, CPA & Co. if you would like to schedule a consultation regarding any of your tax needs.