March 12, 2025 • News and Promotions~MoneyGram in the News
As an immigrant or an expat, you may wonder, how do taxes work in the United States?
Throughout this blog, we’ll answer some questions you may have about US federal income taxes and what may or may not apply to you.
In the United States, there are three types of income tax:
Federal, which is applied to all US citizens, green card holders and non-US citizens that have satisfied the “substantial presence test” as defined by the Internal Revenue Service (IRS). Federal income tax rates range from 10% to 37%, depending on your tax bracket.
State and local, which are applied under similar guidelines as federal, but depend on the state and locality you reside in. However, state income tax is not required by every state. The states that do not have a state income tax include:
The IRS requires all global income to be reported, whether you are an immigrant or an expat. This includes salary, wages, interest on savings accounts, royalties and dividends.
In order to file taxes, you need one of the following:
You are an employee if you completed a W-4 tax form when you were hired. At the start of each year, you will receive a Form W-2 that shows how much you made and paid in taxes last year.
For self-employed individuals, taxes are not deducted from paychecks. Therefore, it is important to track your income over the course of the year.
If you need to request an SSN, click here. For ITINs, click here.
You can save money on your taxes with tax credits and deductions. Credits can lower the amount you owe or help you get a refund. Deductions simply lower the income you are taxed on.
If you are an expat, you can receive a foreign-earned income exclusion or foreign tax credit to avoid paying double taxes.
The IRS requires all taxpayers to file a tax return by April 15.
Yes! Various organizations can guide you through the process of filing a tax return, including:
The Volunteer Income Tax Assistance (VITA) program provides help to people who make $67,000 or less, people with disabilities and limited English-speaking taxpayers.
Additionally, the IRS provides services like Free File and Direct File, where you can file your taxes for free.
Depending on the tax service you use, you should receive your refund within 21 days.
But, when you open a MoneyGram account in the MoneyGram® app, you can receive your tax refund up to 2 days earlier* when you set up direct deposit. It’s easy and only takes a few taps!
Disclaimer: Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to 2 days before the scheduled payment date but may vary.
MoneyGram does not provide tax or accounting advice. This blog is for informational purposes only, and is not intended to provide, and should not be relied on for, tax or accounting advice. Please consult your own tax and accounting advisors.