An E-2 treaty investor visa is a nonimmigrant visa that allows foreign nationals that have treaties with the United States to come to this country if they invest. It is an investment visa that encourages investors to build businesses in the United States. There are a number of advantages to the E-2 visa but there are also questions regarding taxes.
As long as you earn income in the United States, whether you are a citizen, an immigrant, or a nonimmigrant on a visa, you are required to pay taxes. Therefore, as an E-2 visa holder you will have to pay taxes. However, the amount of taxes you pay will depend on your status, your country of origin, and other factors.
Under United States tax law, nonimmigrant visa holders are split into two groups. They are resident and nonresident aliens. Several factors, including the length of your stay in the United States, will determine which group you fall into. There is a difference between the tax requirements for resident and nonresident aliens.
As an E-2 investor, in order to qualify as a resident alien, you must meet the substantial stay test. You must have a substantial presence in the United States. A substantial presence includes 131 days in a calendar year or 183 days in the preceding three years. There are some exceptions and nuances which can be found on the IRS webpage.
If you meet the resident alien test, you will generally be taxed as though you were a U.S. citizen or permanent resident. This means you will have to report all of your worldwide income on your U.S. tax return. All of your income earned in the United States and abroad will be subject to taxation.
A nonresident is a person who does not have a green card and does not meet the substantial stay test. A newly arrived nonimmigrant is generally considered a nonresident for tax purposes. As a nonresident, you only have to report your income that was earned in the United States.
If you are interested in exploring an E-2 investment visa, you should consult with an experienced immigration attorney. At Serving Immigrants, we are happy to discuss your options and walk you through the process. Contact us online or call us at (305) 907-6151 to schedule a strategy session.