Tips on Qualifying For Naturalization Even If You Owe IRS Taxes

By Attorney Caroly Pedersen, CNW Legal Analyst


Many U.S. residents (Green Card holders) who owe taxes to the Internal Revenue Service (IRS) mistakenly believe they are not eligible to obtain U.S. Citizenship, when, in fact, most residents who owe taxes actually remain eligible to apply for naturalization, once they meet certain criteria. The key to successful naturalization for those who owe IRS taxes is in following several basic steps. 

One of the most important requirements to qualify for U.S. citizenship is to show you have “good moral character” in the immediate five years preceding filing the naturalization application  (past three years for early naturalization based upon marriage to a U.S. Citizen). 

Issues that have the most impact on “good moral character,” include an individual’s criminal background, payment of child support and payment of taxes.

If you were convicted for any reason, as a general rule, it’s best to wait until at least five years (or three years in the case of early naturalization) have passed since the date of the conviction or completion of probation. For child support, providing documentary proof of continuing payments, along with proof of current child support payments will often result in Naturalization approval.

When it comes to IRS taxes, many individuals owe back taxes either because they could not afford to pay for previous years’ taxes or because of a mistake on their past taxes. The fear of owing taxes often causes taxpayers to avoid filing a required tax return, which then puts them further behind. The best approach is to file all required taxes for previous years and enter into an installment agreement with the IRS for payment of back taxes owed. Here is what you need to do:


Step#1 File Your Taxes:

If you have failed to file tax returns for past years in which you were required to file, the first step is to file all these delinquent tax returns now. This is required before applying for a payment agreement with the IRS. You should likely get the advice and assistance of an accountant during this process. The IRS will then send you a bill stating the taxes owed.


Step#2 Set Up a Payment Plan With the IRS:

The only way to naturalize when you owe back taxes is to enter into a payment installment agreement with the IRS. To do that, call the IRS and explain you owe taxes and want to set such an installment agreement. Agents are often very understanding and willing to work with you and set the monthly payments as low as possible. Be sure to explain any extenuating circumstances, which negatively affect your income and ability to pay, for instance, any large financial expenditures for medical or other expenses. 


Step#3 Set up Automatic Payments:

Request the IRS agent to set up automatic debits from your bank account. This is the absolute best way to ensure your monthly IRS installment payments are made on time and the best documentary evidence to prove to the USCIS you have been making timely payments on your taxes. 


Step#4 Make Your Payments:

Make sure that you have enough funds in your bank account each month for your scheduled payments. Save copies of your bank statements each month and mark IRS payments in yellow highlight.


Step#5 Prepare To File for Naturalization!

Once you have your installment agreement and have made a few months (3-6 months) of regular payments, you should be ready to file for naturalization. You should contact the IRS and request:

  1. Tax and Wage Transcripts: for the past five years (three years for early naturalization) showing your official taxes filed with the IRS;
  2. Payment Transcript: to show your installment agreement payments to date in order to provide documentary proof to the USCIS.
  3. Installment Agreement and,
  4. Bank Statements with highlights showing all payments made.

Once your Naturalization interview is scheduled, request an updated payment transcript from the IRS to show your payments from the date of filing your application until the interview. Take that along with updated bank statements with highlights showing all IRS payments made while your Naturalization case was processing. 

In cases where a resident failed to file tax returns in previous years, it’s best to prepare a written, signed statement explaining the circumstances of the failure to file, including any financial or family issues which prevented the timely filing and a statement of regret or remorse for the failure. 



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