Receiving an EB-5 green card marks the beginning of a new chapter—and the moment U.S. tax obligations begin to apply to your worldwide income, including income earned in Vietnam. Many Vietnamese EB-5 investors are not fully informed about these requirements and unknowingly fall into tax noncompliance situations that may directly affect their I-829 petitions and future citizenship applications. This article provides a comprehensive explanation of the U.S. tax system for green card holders, what FBAR is, FATCA requirements for Vietnam-based assets, and the legal tax-planning tools every new immigrant should understand from day one.
The Day You Receive Your Green Card: Your U.S. Tax Obligations Begin
Taxes in the United States for new immigrants, green card holder worldwide income reporting 2026
This is the first fact every Vietnamese EB-5 investor must clearly understand:
A green card holder is considered a U.S. tax resident from the date permanent resident status is granted. Under U.S. tax law, green card holders have the same tax obligations as U.S. citizens. They must file annual tax returns and report income from all sources worldwide.
All U.S. citizens and green card holders are required to report their global income to the IRS regardless of where they live, including income that has already been taxed in another country.
What Does This Mean for Vietnamese Investors Who Have Just Received an EB-5 Green Card?
If you continue operating a business in Vietnam, earn rental income from properties in Hanoi or Ho Chi Minh City, receive dividends from company shares, or earn interest from Vietnamese bank accounts, all of that income must be reported on your annual U.S. tax return.
This does not necessarily mean you will pay double taxation on all of that income. There are legal tax relief mechanisms available. However, the reporting obligation itself is absolute.
Consequences of Non-Compliance
Failure to comply can create not only tax issues but also complications in immigration matters, particularly when tax compliance is reviewed during immigration adjudications.
A green card holder living and working outside the United States does not automatically end U.S. tax obligations simply by leaving the country.
See also: Legally Transferring Investment Funds to the United States
The U.S. Tax System for Green Card Holders: Three Parallel Layers of Obligations
Many Vietnamese investors assume that U.S. taxation consists of filing a single tax return. In reality, there are three separate compliance layers. Missing any one of them can result in substantial penalties even if the other two are fully satisfied.
Layer 1: Annual U.S. Income Tax Filing Form 1040
All green card holders file taxes using Form 1040, the standard income tax return used by both U.S. citizens and permanent residents.
You must report income from all worldwide sources, including:
Employment income
Business income
Investment income
Real estate income
Dividends
Interest income
This reporting requirement applies regardless of whether the money is held in the United States or Vietnam.
2026 Filing Thresholds (For Tax Year 2025)
Tax filing requirements apply whenever income meets or exceeds the minimum filing threshold based on filing status.
Filing deadlines:
April 15 for taxpayers residing in the United States
Automatic extension until June 15 for taxpayers living abroad
Additional extension available until October 15 upon request
What Tax Bracket Applies to Vietnamese Green Card Holders?
Taxable income includes:
Wages, bonuses, and stock compensation
Self-employment and consulting income
Business profits
Interest income
Dividend income
Capital gains
Rental income
Income from all countries must be included, not just income earned in the United States.
The U.S. federal income tax system for tax year 2025 uses progressive tax brackets ranging from 10% for lower-income taxpayers to 37% for income exceeding $626,350 (single filers) or $751,600 (married filing jointly).
Layer 2: FBAR Foreign Bank Account Reporting
What Is FBAR?
FBAR (Foreign Bank and Financial Account Reporting) is an annual reporting requirement under the Bank Secrecy Act.
U.S. persons must file an FBAR if the aggregate value of foreign financial accounts exceeds $10,000 at any point during the year.
Accounts subject to FBAR reporting may include:
Foreign bank accounts
Foreign brokerage accounts
Foreign mutual funds
Certain foreign retirement accounts
Foreign life insurance policies with cash surrender value
How FBAR Applies to Vietnamese EB-5 Investors
Most Vietnamese investors who receive a green card exceed the $10,000 threshold immediately because their Vietnamese bank accounts often hold balances well above that amount.
FBAR Filing Deadline
Due date: April 15 annually
Automatic extension until October 15
Filing form: FinCEN Form 114
Filing method: Electronic filing through the BSA E-Filing System
Importantly, FBAR is filed separately from Form 1040 and is submitted to a different government agency.
FBAR Penalties in 2026
Non-willful violations: Up to $16,536 per violation.
Willful violations: The greater of:
$165,353; or
50% of the account balance per year.
These penalty amounts reflect inflation-adjusted 2026 figures.
In January 2026, courts reaffirmed that recklessness may be sufficient to trigger willful FBAR penalties. Simply claiming ignorance of the law is generally not an adequate defense.
The IRS can identify unreported foreign accounts through multiple channels, including:
FATCA information-sharing agreements
Form 8938 cross-checking
International tax treaties
Foreign financial institution reporting systems
In serious cases, IRS Criminal Investigation may become involved.
Layer 3: FATCA Reporting for Significant Foreign Financial Assets
FATCA Vietnam: What EB-5 Investors Need to Know
Under FATCA, certain U.S. taxpayers holding foreign financial assets must report those assets to the IRS on Form 8938 (Statement of Specified Foreign Financial Assets).
Failure to report can result in severe penalties.
FATCA Thresholds for Green Card Holders Living Abroad
For green card holders residing outside the United States:
Single filers:
More than $200,000 at year-end; or
More than $300,000 at any point during the year.
Married filing jointly:
More than $400,000 at year-end; or
More than $600,000 at any point during the year.
For taxpayers residing in the United States, lower thresholds apply:
Single filers:
$50,000 year-end
$75,000 at any time
Married filing jointly:
$100,000 year-end
$150,000 at any time
FBAR vs. FATCA: They Do Not Replace Each Other
FBAR and FATCA are separate reporting regimes.
If both reporting thresholds are exceeded, investors must file both forms.
Filing one does not satisfy the requirements of the other.
FBAR is filed with FinCEN.
FATCA Form 8938 is filed with the IRS as part of Form 1040.
Have you recently received your EB-5 green card and are unsure where to begin with U.S. tax compliance? Contact VITA CAPITAL for comprehensive post-immigration guidance, including introductions to international tax professionals experienced with Vietnam–U.S. asset structures. Initial consultations are completely free.
Legal Tax Reduction Tools for U.S. Tax Green Card Holders
U.S. tax green card holder FEIE FATCA FBAR legal tax reduction tools for Vietnamese immigrants 2026
The good news is that the U.S. tax system provides several legitimate tax-planning tools designed to help individuals avoid double taxation when earning income in multiple countries.
Tool #1: Foreign Earned Income Exclusion (FEIE)
The Foreign Earned Income Exclusion (FEIE) allows eligible taxpayers to exclude up to $130,000 of foreign earned income from U.S. taxation for tax year 2025 (filed in 2026). For tax year 2026, this exclusion increases to $132,900.
FEIE is most beneficial for:
Green card holders living and working abroad
Individuals residing in low-tax or no-tax jurisdictions
Taxpayers whose earned income falls below the exclusion threshold
To qualify, an individual must satisfy either:
Physical Presence Test
Be physically present outside the United States for at least 330 full days during any consecutive 12-month period.
Bona Fide Residence Test
Be a genuine resident of a foreign country for an entire tax year.
Important Limitation
FEIE applies only to earned income, including:
Employment income
Self-employment income
It does not apply to passive income such as:
Dividends
Interest income
Rental income
Capital gains
Tool #2: Foreign Tax Credit (FTC)
The Foreign Tax Credit (FTC), claimed through Form 1116, may be used for foreign-source income not excluded under FEIE.
A critical rule to remember:
You cannot claim FTC on income already excluded under FEIE. The two benefits cannot be applied to the same income.
How FTC Works
If you have already paid income tax in Vietnam on certain earnings, you may generally claim a credit against your U.S. tax liability for taxes paid abroad.
This can significantly reduce or even eliminate the impact of double taxation.
FTC is often more advantageous than FEIE for taxpayers residing in countries with relatively high tax rates because it provides a dollar-for-dollar credit for foreign taxes actually paid rather than excluding a fixed amount of income.
Tool #3: Standard Deduction 2026
As U.S. permanent residents, green card holders are eligible for the standard deduction.
For tax year 2026:
$15,000 for Single Filers
$30,000 for Married Filing Jointly
The standard deduction directly reduces taxable income before tax calculations are made and generally requires no additional documentation.
Tool #4: Child Tax Credit and Education Credits
Green card holders qualify for the same family-related tax credits available to U.S. citizens, including:
Child Tax Credit
Up to $2,000 per qualifying child under age 17
American Opportunity Tax Credit
Up to $2,500 annually for eligible college education expenses
Lifetime Learning Credit
Available for qualified higher education and continuing education expenses
These benefits provide a meaningful financial advantage compared with international students on F-1 visas, who often do not qualify for many of these credits.
U.S. Income Tax for Vietnamese Green Card Holders: 5 Common Real-Life Scenarios
Below are the five most common situations faced by Vietnamese EB-5 investors after receiving their green cards.
Scenario 1: Continuing to Operate a Business in Vietnam
This is both the most common and the most complex situation.
Income generated from a Vietnamese business must generally be reported on Form 1040.
If you own more than 10% of a foreign corporation, additional reporting requirements may arise, including Form 5471 (Information Return of U.S. Persons With Respect to Certain Foreign Corporations).
Form 5471 is widely considered one of the most complex forms in the U.S. tax system and typically requires assistance from an experienced international tax professional.
Recommended Approach
Report all business income properly.
Utilize Foreign Tax Credits for taxes already paid in Vietnam.
Seek international tax planning advice before receiving your green card whenever possible.
Scenario 2: Owning Rental Property in Vietnam
Rental income from Vietnamese real estate must be reported on Schedule E of Form 1040.
The IRS and FinCEN use sophisticated data analytics and reporting systems to identify unreported foreign income.
Vietnam and the United States continue expanding financial information exchange under FATCA-related frameworks.
Recommended Approach
Report all rental income.
Deduct eligible expenses such as:
Property maintenance
Property management fees
Depreciation
Claim FTC for taxes already paid in Vietnam.
Scenario 3: Vietnamese Savings Accounts and Investment Portfolios
Interest income and dividends from Vietnamese financial accounts must be reported on Form 1040.
This is one of the most frequently overlooked reporting obligations because many investors assume that money held in Vietnam is invisible to U.S. authorities.
In reality, FATCA agreements with more than 110 jurisdictions allow extensive information sharing regarding U.S. account holders.
Failure to report does not reduce the risk of detection. In some cases, it may increase the likelihood that the IRS views the violation as willful, resulting in substantially higher penalties.
Scenario 4: A Spouse Remains in Vietnam Without a Green Card
If only the principal EB-5 applicant has obtained permanent residence while the spouse remains in Vietnam without a green card, an important tax decision must be made.
Married Filing Jointly
Advantages:
Higher tax thresholds
Larger deductions
Access to additional tax benefits
Disadvantages:
Worldwide income of both spouses must be reported
Married Filing Separately
Advantages:
Only the green card holder's income is generally reported
Disadvantages:
Reduced deductions and tax benefits
Because the financial consequences can be significant, professional tax advice is strongly recommended before filing the first tax return.
Scenario 5: Selling Assets in Vietnam After Receiving a Green Card
Capital gains from selling Vietnamese real estate, business interests, or other assets after becoming a green card holder must generally be reported for U.S. tax purposes.
Long-Term Capital Gains
Assets held for more than one year may qualify for preferential tax rates:
0%
15%
20%
Depending on income level.
Short-Term Capital Gains
Assets held for one year or less are generally taxed at ordinary income tax rates.
Strategic Consideration
If you plan to sell significant assets in Vietnam, consider whether completing the transaction before obtaining a green card may be beneficial.
Prior to becoming a U.S. tax resident, gains from such transactions generally fall outside the scope of U.S. taxation.
See also: The EB-5 Process from Vietnam to the United States: A Detailed 7-Step Guide
Important U.S. Tax Deadlines in 2026 Every Green Card Holder Should Know
Deadline
Requirement
Notes
January 15
Pay Q4 2025 Estimated Taxes
If you have income not subject to withholding
April 15
File Form 1040 (Tax Year 2025) and FBAR
Standard filing deadline
June 15
Automatic extension for taxpayers living abroad
No application required
October 15
Final extension deadline for Form 1040 (with Form 4868)
FBAR is automatically extended to this date
December 31
End of Tax Year 2026
Begin preparing records for the next filing season
An Important Note About State Taxes
Moving abroad does not automatically terminate your state tax obligations.
States such as California, New York, Virginia, and New Mexico may continue to tax worldwide income even after a taxpayer leaves the United States.
In addition, most states do not recognize the Foreign Earned Income Exclusion (FEIE). As a result, income excluded from federal taxation may still be subject to state income tax.
Properly establishing or changing state residency before relocating abroad can potentially save thousands of dollars in taxes.
Practical Implications for EB-5 Investors
Many Vietnamese immigrants choose to establish residence in states with large Vietnamese communities such as California or New York.
However, if you later return to Vietnam to continue managing a business or investments, those states may still claim taxing authority over your worldwide income.
This is why selecting your initial state of residence should be part of a broader tax-planning strategy rather than merely a lifestyle decision.
Exit Tax: What Many Green Card Holders Do Not Know
One of the most important tax concepts to understand from the beginning is that obtaining a green card does not permanently lock you into the U.S. tax system—but leaving that system can come at a cost.
Green card holders generally cease being U.S. tax residents by formally abandoning permanent resident status through Form I-407 filed with USCIS or by otherwise no longer meeting the IRS definition of a lawful permanent resident for tax purposes.
This is where immigration law and tax law intersect. A seemingly simple change in immigration status can significantly alter tax obligations.
What Is the Exit Tax?
The Exit Tax may apply to individuals who:
Have a net worth exceeding $2 million, or
Have average annual U.S. income tax liabilities exceeding $206,000 (2026 threshold) during the five years preceding expatriation.
If subject to Exit Tax rules, the IRS generally treats all assets as if they were sold on the day before expatriation.
Capital gains tax is then assessed on unrealized gains exceeding the applicable exemption amount.
Why This Matters for EB-5 Investors
Many investors focus entirely on obtaining a green card without considering long-term tax planning.
However, decisions regarding:
Asset ownership structures
Business holdings
Real estate investments
International financial accounts
can significantly affect future tax obligations if permanent residency is later relinquished.
For this reason, tax planning should begin when you receive your green card—not when you decide to give it up.
See also: EB-5 Timeline 2026 – Step-by-Step Guide
VITA CAPITAL: Comprehensive Post-Immigration Support Including U.S. Tax Guidance
The EB-5 journey does not end when a green card is approved. Rather, it marks the beginning of a new chapter filled with legal, financial, and compliance responsibilities that require careful management.
VITA CAPITAL Your Global Future supports Vietnamese investor families not only throughout the EB-5 application process but also during every stage of post-immigration life.
Our services include:
U.S. settlement assistance
Referrals to qualified U.S. and international tax professionals familiar with Vietnam–U.S. cross-border asset structures
Strategic planning for I-829 petitions
Guidance on FBAR and FATCA compliance
Long-term preparation for U.S. citizenship eligibility
Through collaboration with Toppins Law Firm, P.C. (over 30 years of U.S. immigration law experience) and FirstPathway Partners (FPP) (100% project approval track record since 2008), Vietnamese investors receive comprehensive support covering both immigration and financial compliance from filing Form I-526E through successful naturalization.
Your U.S. tax obligations begin the day you receive your EB-5 green card.
Do not allow FBAR violations, FATCA non-compliance, or unreported Vietnamese income to complicate your I-829 petition or delay your family's path to U.S. citizenship.
Contact VITA CAPITAL today for a complimentary post-immigration consultation tailored to your situation.
