June 2012

Immigration News + Analysis

Maggio + Kattar

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Washington, DC 20036
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Taxation of foreign workers can be perplexing to both the foreign worker and their U.S. employers. We have summarized some common terms and provided suggestions on improving corporate compliance programs. To learn more about requirements for payroll tax withholding, please see IRS Publication 519 or request a referral to M6 HR from your M+ K legal professional.

 

For tax purposes, a foreign worker is classified as being a:

 

Resident Alien: This is a foreign person who satisfies the "green card test" or who has been present in the U.S. long enough to satisfy the "substantial presence test" For payroll tax withholding purposes, you would treat this group in the same manner as U.S. citizens.

 

Non-resident Alien: This is a foreign person who does not qualify as a Resident Alien, or who qualifies for an exemption for the substantial presence test for a period of time. The IRS guidelines have determined that it is the employee's responsibility to notify the employer of their status as well as any changes to their status.

 

+        Non-resident aliens are usually subject to graduated withholding at the same rates as U.S. Citizens and Resident Aliens.

 

+        Non-resident aliens are subject to Social Security and Medicare tax, unless in a visa status exempted by USCIS benefit or totalization agreement.

 

+        Non-resident aliens* must follow modified instructions when completing the Form W-4 which requires the non-resident alien to:

 

+    write "Non-Resident Alien" or "NRA" above the dotted line on line 6;

+   not write "exempt" on line 7;

+   claim only "single" on line 3 ( even if married)

+   claim no more than 1 personal exemption

 

*exceptions may apply to non-resident aliens from Mexico, Canada, Korea and India

  

Foreign Students and Exchange Visitors/Trainees: The substantial presence test for the Resident Alienclassification does not apply to foreign students and exchange visitors/trainees in F, J, M, or Q visa statuses. They are considered "Non-resident aliens" while in one of these visa statuses and are exempt from Social Security and Medicare taxation for a period of time as well. The period of time for the exemption varies by visa type with helpful information to be found in IRS Publication 519 . The foreign worker is responsible for notifying their employer when their status has changed.

 

Some Compliance Steps to Consider:

 

+        Ensure staff that facilitate new employee paperwork completion as well as those who process payroll are aware of the IRS rules for completing W-4 for Non-resident aliens.

 

+        Consider having foreign workers who are exempt from Social Security and Medicare complete a separate "FICA Exemption Certification" Form that will serve as a document to provide to payroll as well as reiterate to the employee their responsibility to notify payroll and complete a new W-4 if their status changes.

 

 

** Maggio + Kattar thanks M6 HR for sharing this information on payroll and withholding for foreign workers.

 

 

 

On June 25, 2012, the U.S. Supreme Court issued an important ruling on one of the nation's most controversial immigration laws, striking three out of the four key provisions, of Arizona's SB1070. In its decision, the Court struggled to balance Arizona's right to create and enforce its own laws with the federal government's sole authority over its federal powers - including immigration.

Signed into law in April 2010, the "Support Our Law Enforcement and Safe Neighborhoods Act," (SB1070), provided Arizona law enforcement officers with unprecedented power to detain and criminally prosecute undocumented immigrants in the state. The law contained four main provisions that were considered by the Supreme Court. The first provision, generally referred to as the "show me your papers" provision, allowed state law enforcement to investigate individuals' immigration status if they "suspected" them to be undocumented. The second provision permitted Arizona police to arrest individuals without a warrant if they suspected the individuals to be deportable. The third and fourth provisions made it a state crime for individuals to fail to carry federal registration papers and to work in the state without work authorization.

 

On July 6, 2010, soon after SB1070 became law, the Department of Justice challenged the state law in federal court, arguing the state law had overstepped federal authority. Within one year of its signing, both the Federal District and Ninth Circuit Court of Appeals blocked all four provisions of the controversial law, preventing it from ever going into effect.

 

As Secretary of Homeland Security, Janet Napolitano, recently said at the United States Citizenship and Immigration Services Stakeholder Symposium, the Court's decision "was all about preemption." Federal preemption prevents any state from passing laws that would conflict or impose restrictions on federal laws. The lower courts, in reviewing SB1070, had determined that all provisions of the law directly conflicted with the federal government's duty to uniformly regulate and enforce immigration law in the United States. Therefore, the state law was "preempted" by federal law.

 

On review, the Court only focused on the issue of preemption, not the possible discriminatory effect the law might have on the people living in Arizona. It squarely determined that three out of the four provisions of the Arizona law violated federal preemption in the context of immigration. It struck down Arizona's criminalization provisions as well as the provision which granted police complete freedom to arrest and detain suspected undocumented immigrants.

 

However, because the Court focused its reasoning on preemption, it found that the law's first provision could stand, requiring Arizona law enforcement to question individuals who could be undocumented. In concluding that the provision could remain in effect, the Court stated that there were simply not enough facts to determine whether the provision violated federal preemption. In fact, the Court stated that the provision could be read to avoid concerns of preemption. 

 

Nevertheless, the Court also clarified that while the provision did not violate preemption, its real and practical impact on the people in Arizona had yet to be seen. Specifically, the "reasonableness" of a stop to check immigration status may be called into question, leaving the door open for future challenges to this provision based on unlawful discrimination.

 

While the Court's decision may not have led to the complete termination of the Arizona law, its reasoning provides a clear declaration to states that have tried to over-regulate and enforce immigration law. It also provides a skeptical critique on states that try to curtail illegal immigration by targeting and labeling undocumented immigrants as criminals. Most importantly, the Court's decision emphasizes the sentiment that the people of Arizona need not fear misguided state immigration legislation.

The U.S. Department of State (DOS) July 2012 Visa Bulletin reports that the employment based second preference (EB-2) "worldwide" category will retrogress to January 1, 2009. Despite rumors that the EB-2 worldwide category might become unavailable in July, DOS has not yet taken this drastic step, but notes that it may still occur in August or September based on usage in the next month. The new fiscal year's visa numbers will become available on October 1, 2012.

The EB-2 category for nationals of India and China became unavailable in June after rapid movement forward during the earlier part of this fiscal year as noted in our May 2012 Newsletter.  

 

In the July 2012 Visa Bulletin, EB-1, EB-4 and EB-5 categories - Employment Based First, Fourth and Fifth -- categories remain current. The EB-3 continues to be available, albeit still significantly backlogged, for world wide applicants to July 22, 2006 and for India (September 22, 2002) and China (September 22, 2005).

 

The American Immigration Lawyers Association (AILA) notes the following based on discussions with the DOS' Visa Office:

 

+ The EB-2 category for individuals born in Mainland China and India will likely move to August or September 2007 in the new fiscal year (beginning on October 1, 2012).

+It is unlikely that EB-2 for Mainland China and India will move forward during the first two quarters of the new fiscal year.

+The EB-2 Worldwide visa numbers may become unavailable before the end of this fiscal year, however, it will likely be current again in the 2013 fiscal year.

+The so-called "upgrade" cases -- where the applicant moves from an EB-3 to an EB-2 case -- are extremely difficult to predict as USCIS and DOS do not have the mechanism to monitor these cases.  DOS notes that it expects about 10-15,000 numbers are used for these "upgrades" annually.

On June 11, 2012, President Obama signed a bill that added Israel to the list of countries whose citizens are eligible for E-2 non-immigrant investor visas.  Although Israelis have been eligible for E-1 treaty trader visas for some years, legislation was required to extend this privilege to E-2 investor visas as the bilateral treaty of commerce and trade between Israel and the United States did not originally extend to treaty investors.

Although the legislation has now been enacted into law, E-2 visas will not be available for Israeli investors until the U.S. and Israel have agreed on terms and regulations governing their availability under the treaty.  The U.S. Embassy in Tel Aviv will issue a press release once this has been accomplished and the consular section is authorized to process E-2 visa applications.

United States Citizenship and Immigration Services held a Stakeholders Meeting on Tuesday, June 26th at which agency leaders including DHS Secretary Napolitano, USCIS Director Mayorkas and key staff members engaged with stakeholders on a variety of topics. Included in the discussion were significant and recent changes such as the recent DREAMers memo, the integration of technology and training for adjudicating officers of key non-immigrant visa petitions.   USCIS noted that it is currently working on implementing the proposed Deferred Action application form and guidelines and that there will be a fee attached to the filing and biometrics will be required. Following questions from Stakeholders seeking clarification on key eligibility factors for  DREAMer "Deferred Action," USCIS confirmed that changing the proposed criteria is not under consideration at this time. For individuals in removal proceedings, it was made clear that administrative closure and deferred action would be offered but that termination of removal proceedings was not a likely outcome.

 

Director Mayorkas noted that H-4 (spouse and child under 21 of an H-1B non-immigrant) proposed regulations that include a provision for work authorization in certain circumstances is forthcoming and will likely be published in the next few weeks. Additionally, we can expect some guidance on possible F-2 Employment Authorization opportunities at some point in the future.

 

Finally, Director Mayorkas stated that the agency was continuing to "strive for excellence" in its adjudications and that forthcoming collaboration with fellow agencies such as a joint DOS training on L-1 adjudications would further support that goal.

 

We sincerely appreciate Secretary Napolitano and Director Mayorkas and their teams for engaging with Stakeholders in an open forum environment and look forward to continued close collaboration as the agency improves its processes.

The Administrative Appeals Office recently approved a P-3 Petition that helped broaden the definition of "culturally unique." P-3 petitions are for culturally unique performers or groups, teachers and coaches, and their essential support personnel. Although Congress did not define the term culturally unique, immigration regulations set the following parameters: "a style of artistic expression, methodology, or medium unique to a particular country, nation, society, class, ethnicity, religion, tribe, or other group of persons." The recent AAO decision finds that, in addition to traditional art forms, culturally unique "may include artistic expression that is deemed to be a hybrid or fusion of more than one culture or region" and groups or persons "whose unique artistic expression crosses regional, ethnic, or other boundaries." Evidence in support of a P-3 petition must demonstrate that if the artistic expression in question draws from diverse influences, that it is still "unique to an identifiable group of persons with a distinct culture."

 

The P-3 petition reviewed by the AAO involved an Argentinean music group that blends Jewish music of Eastern Europe with Latin and South American influences. The AAO found that the evidence submitted convincingly demonstrated that the group's artistic expression represented Buenos Aires' Jewish immigrant community and that there is a musical movement in Argentina that fuses Argentine styles with influences from Jewish and other Eastern European styles.

 

The P-3 visa is a useful option for individuals and groups in the arts who do not have the requisite international recognition required for the O-1 and P-1 classifications. The AAO's open-minded approach to defining culturally unique provides an opportunity for other performers to travel to the U.S. to share their art and enrich the performing arts in the U.S.

Foreign nationals who want to travel to Canada, but who are inadmissible for previous criminality, can overcome this inadmissibility and gain entry into Canada through a variety of ways, such as applying for a Temporary Resident Permit (TRP). A TRP is issued for a limited period of time and is only granted in exceptional cases.

Effective March 1, 2012, individuals who were previously ineligible to enter Canada due to past criminality may be granted a TRP without having to pay the $200 processing fee. This new policy is part of Canada's "Tourism Facilitation Action Plan" (TFAP). To be eligible for a fee-exempt TRP, foreign nationals with criminal convictions, may be eligible to cross the border, if they have one single criminal conviction on their record; have served no jail time for that conviction; have committed no other acts that would prevent them from entering Canada; and are not inadmissible for any other reason. Eligible offenses include, but are not limited to, driving under the influence of alcohol, public mischief or shoplifting. Individuals who have been convicted of more serious criminal offences, such as robbery, fraud (over $5000 CAD), assault causing bodily harm, or committing an act punishable by a maximum of ten years or more under Canadian federal legislation, will not be eligible for TRP or the fee exemption. Applications for fee-exempt TRPs can be made at a Canadian visa office or at the Port of Entry.   

 

According to the Canadian consulate, this shift in border crossing practices will focus mainly around the fee charged for the permit, not the reasons the permit is issued, and those looking to gain entry should still apply for the permit at least six months in advance. All of the other requirements for obtaining a TRP remain the same. TRP applicants will still have to demonstrate they have a compelling reason for entering Canada and that they do not pose a threat to Canadian society.

 

 This change in policy was brought on by pressure from the Canadian tourist industry complaining about lost American tourist dollars. Due to Canada's admissibility laws, many tourists or business travelers from the United States are turned away every year at airports, ferry crossings, and land border crossings for having a prior criminal conviction on their record, even if it occurred decades ago.  This caused a negative impact on the Canadian economy. Thus, the intent of this new public policy is to allow easier one-time entry to travelers with minor offenses such as misdemeanor DUI or DWI convictions.   However, the Canadian laws regarding admissibility have not changed. Entry into Canada is not guaranteed and the Canadian Border Services Agency still retains complete discretion to allow, or deny, entry to foreign nationals. It is therefore unclear whether this new policy will actually result in easier entry to Canada for those with minor offenses. Also, because this is a one-time only fee exemption, once the TRP has expired, foreign nationals will need go through the normal process of applying and paying for a TRP or applying for "deemed rehabilitation" during later border crossings.  

The Department of Homeland Security (DHS) and the Department of Justice (DOJ) recently released guidance on the issue of the return of noncitizens to the United States after obtaining a positive decision from a federal court or from the Executive Office for Immigration Review (EOIR). 

As a matter of background, in 2009 the Supreme Court issued a decision in Nken v. Holder, 556 U.S. 418 (2009), discussing the criteria that a court of appeals should consider in deciding whether to order a stay of removal pending consideration of a petition for review. During its argument, the government indicated that petitioners are not significantly harmed should they be deported during the process because the government has a return policy and procedure in place pursuant to its parole authority under INA § 212(d)(5). No other information was provided to the Court regarding this policy and the Court ultimately ruled in favor of the petitioner in the case and granted a stay of removal.

 

Subsequent to the decision, the National Immigration Project of the National Lawyers Guild (NIPNLG) filed a Freedom of Information Act (FOIA) request to obtain additional documentation relating to the government's return policy and procedure. Ultimately, NIPNLG prevailed and the federal district court ordered the government to disclose its records. As a result of the FOIA litigation, it became obvious that the government did not, in fact, have a policy in place for the return of successful litigants at the time of the oral arguments before the Supreme Court in Nken v. Holder.

 

On April 24, 2012, the Department of Justice released guidance from the Department of State and the Department of Homeland Security on its new return policy.   Under this new policy, Immigration and Customs Enforcement (ICE), the enforcement wing of DHS, has indicated that if a legal permanent resident (LPR) prevails in a petition for review and has already been removed, he or she will be considered to be reinstated to LPR status and ICE will work to facilitate his or her return to the United States.   If a non-LPR prevails on a petition for review and has already been removed, ICE will decide on a case-by-case basis whether his or her presence in the United States is necessary for completion of the proceedings. ICE will, however, comply with a specific decision from the federal court, ordering the return of the noncitizen regardless of whether the litigant is a lawful permanent resident or not and whether his or her presence is needed for completion of proceedings.

 

ICE will generally not return successful litigants - lawful permanent resident or otherwise - whose cases are reopened by the Board of Immigration Appeals or an Immigration Judge regardless of whether their presence is need to complete the proceedings. However, it will entertain any requests for the return of a noncitizen in this situation on a case-by-case basis.   ICE noted that proceedings may be conducted with a noncitizen's appearance via video conferencing from a U.S. Embassy or the office of a non-governmental organization (NGO) abroad. ICE further indicated that noncitizens who were removed while detained and who are returned to the United States to continue their litigation will likely be detained upon their return.

 

In sum, ICE will not automatically return a successful litigant to the United States unless specifically ordered to do so by a federal court of appeals. Although ICE certainly has the discretion to return successful litigants whose cases have been reopened by the Board of Immigration Appeals or the Immigration Judge, it seems unlikely they will do so. However, it is important to emphasize that ICE has agreed to consider such requests on a case-by-case basis. Thus, attorneys with cases pending before a federal court, the Board of Immigration Appeals or an Immigration Judge where their clients have been removed and are outside of the United States are urged to specifically request that the federal or administrative court specifically order their clients' return to the United States to pursue follow-up proceedings. With cases pending before the Board or an Immigration Court, counsel should present detailed, strong and persuasive arguments to support a client's return, and address the reasons why video-conferencing is not an adequate substitute.   It is important to highlight that several federal courts have concluded that a noncitizen may file a motion to reopen or reconsider within the relevant statutory timeframes, even if the individual has been physically removed, lending credence to arguments for a noncitizen's return to pursue recognized rights.

In Matter of Rodriguez, Mr. Rodriguez, a native and citizen of El Salvador, had entered the United States without inspection in 1981 and later adjusted his status to lawful permanent residency under the legalization program in section 245A of the Immigration and Nationality Act. In 2007, the respondent was convicted of bank fraud. He conceded removability as a noncitizen convicted of an aggravated felony and sought relief from removal under INA § 212(h), a provision within the Immigration and Nationality Act which provides a waiver for persons with certain criminal convictions.

A waiver under INA § 212(h) is not available to a noncitizen who has previously been admitted to the United States as an "alien lawfully admitted for permanent residency if...since the date of such admission the alien has been convicted of an aggravated felony..." A number of federal courts have addressed the issue of whether this bar applies to noncitizens who adjusted their status to lawful permanent residency status after having either been admitted initially as a nonimmigrant or after having entered without inspection. The Board of Immigration Appeals and a number of federal courts have differing opinions on the issue.   

 

Similarly, in Matter of Koljenovic, 25 I&N Dec. 219 (BIA 2010), the Board held that section 212(h) relief is not available to a lawful permanent resident (LPR) who has been convicted of an aggravated felony after acquiring lawful permanent resident status regardless of whether he entered with an immigrant visa or obtained residency status after admission through adjustment of status. However, the Fourth, Fifth and Eleventh Circuits disagree with this interpretation of the statute and have held that an aggravated felony conviction bars a noncitizen from section 212(h) relief only if the noncitizen was admitted to the United States as a lawful permanent resident following inspection at a port of entry.

 

Thus, the aggravated felony bar to section 212(h) relief does not apply to lawful permanent residents subject to removal as aggravated felons who adjusted their status after admission or entry to the United States and who are placed in removal proceedings in the Fourth, Fifth or Eleventh Circuits. The Board reaffirmed this position in Matter of Rodriguez, 25 I&N Dec. It is anticipated that this issue will be litigated in other circuit courts of appeals. Stay tuned for more discussion on this issue as it continues to be discussed and addressed by other courts.

Maggio + Kattar provides Immigration News + Analysis as a service to its clients and friends to highlight and provide opinions on changes within the field of immigration and nationality law. The information contained in this newsletter is not intended as legal advice, and persons receiving this information should not act on it without consulting professional legal counsel.


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