Obtaining a Green Card, or permanent resident status, is a significant milestone for many immigrants aiming to live and work in the USA. However, it also brings various responsibilities, especially concerning taxes and financial planning. In this blog post, we will cover everything you need to know about living in the USA with a Green Card, including tax obligations, dual citizenship, and the application process.

What is a Green Card?

A Green Card, officially known as a Permanent Resident Card, allows non-U.S. citizens to live and work permanently in the United States. The U.S. Citizenship and Immigration Services (USCIS) issues Green Cards through various pathways, including family sponsorship, employment, refugee or asylum status, and the Diversity Visa Lottery.

Responsibilities of Green Card Holders

As a Green Card holder, you are required to comply with U.S. laws and regulations. This includes filing U.S. tax returns and paying federal, state, and local taxes. Your worldwide income becomes subject to U.S. tax laws, and you must file a U.S. tax return annually.

Tax Obligations for Green Card Holders

Living in the USA with a Green Card entails various tax obligations:

1. Federal Income Tax: Green Card holders must report their worldwide income to the Internal Revenue Service (IRS) and file a federal income tax return annually. This includes income earned both within and outside the USA.

2. State and Local Taxes: Depending on the state you reside in, you may also need to file state and local tax returns. Each state has different tax laws, so it’s essential to be aware of your specific obligations.

3. Social Security and Medicare Taxes: As a Green Card holder, you are also required to pay Social Security and Medicare taxes on your earnings.

4. Tax Deductions and Credits: You may be eligible for various tax deductions and credits, such as the Earned Income Tax Credit (EITC), Child Tax Credit, and education credits.

Double Taxation and Tax Treaties

One of the significant concerns for Green Card holders is the potential for double taxation, where the same income is taxed by both the USA and their home country. The USA has tax treaties with many countries to mitigate this issue. These treaties often provide mechanisms to avoid double taxation, such as foreign tax credits and exemptions.

Green Card and Dual Citizenship

Green Card holders can apply for U.S. citizenship through the naturalization process after meeting specific residency requirements. Dual citizenship allows individuals to be citizens of two countries simultaneously, but it’s essential to understand the implications, especially regarding taxes and legal obligations.

Applying for a Green Card

The Green Card application process involves several steps, including:

1. Determine Your Eligibility: Eligibility varies based on the category under which you are applying, such as family sponsorship, employment, or refugee status.

2. File an Immigrant Petition: Typically, a family member or employer files this petition on your behalf. In some cases, you may be eligible to file yourself.

3. Wait for a Decision: The USCIS will review your petition and inform you of its decision. This process can take several months or even years, depending on your category and country of origin.

4. Apply for a Green Card: Once your petition is approved, you can apply for a Green Card through consular processing if you are outside the USA or adjustment of status if you are already in the USA.

5. Attend an Interview: You may be required to attend an interview as part of the application process.

6. Receive Your Green Card: If approved, you will receive your Green Card, granting you permanent resident status.

Financial Planning for Green Card Holders

Effective financial planning is crucial for Green Card holders. Here are some strategies to consider:

1. Tax Planning: Work with a tax professional to understand your tax obligations and optimize your tax situation. This includes utilizing tax treaties, credits, and deductions.

2. Retirement Planning: Contribute to retirement accounts like 401(k)s and IRAs. Green Card holders can benefit from the same retirement planning tools as U.S. citizens.

3. Estate Planning: Ensure that your estate plan complies with both U.S. and foreign laws, especially if you have assets in multiple countries.

4. Education Savings: Consider saving for your children’s education using tax-advantaged accounts like 529 plans.

How Tam Accounting Can Help

At Tam Accounting, we specialize in helping Green Card holders navigate their tax obligations and financial planning needs. Led by IRS Enrolled Agent Yesim Deretam, our team is equipped to provide expert guidance on:

  • Tax planning and compliance
  • Retirement and estate planning
  • Double taxation mitigation
  • Financial planning and investment strategies


Living in the USA with a Green Card comes with various responsibilities, especially regarding taxes and financial planning. Understanding these obligations and planning accordingly can help you avoid potential pitfalls and make the most of your residency in the USA. For personalized assistance and expert advice, contact Tam Accounting today. We are here to help you navigate the complexities of your financial and tax responsibilities with confidence.

By providing a comprehensive overview of the Green Card process and associated responsibilities, this blog post aims to inform readers about the critical aspects of living in the USA as a Green Card holder.

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