Tax & Accounting Blog

Who Is a U.S. Citizen and Why It Matters: Part 3 – Who Has U.S. Citizenship?

1099, ONESOURCE, Tax Information Reporting, TIN Compliance, W-8 & W-9 Foreign Reporting, Withholding Management October 2, 2012

The 14th amendment to the Constitution of the United States confers U.S. citizenship status on individuals born or naturalized in the U.S. The Supreme Court has upheld the right of Congress to determine how citizenship is conferred to individuals not born or naturalized in the U.S. As a result, citizenship may be conferred by: 1) place of birth, 2) birth to (or adoption by) a U.S. citizen parent if prescribed conditions are met, or 3) naturalization. The rules subject to legislation have changed periodically.

a. Place of Birth
Under the Constitution, individuals born in the U.S. are citizens of the U.S. (called birthright citizenship). This includes children of noncitizens born in the U.S. whether their parents were legal or illegal residents of the U.S. at the time. Citizenship status is also conferred on individuals born in Puerto Rico, Guam or the U.S. Virgin Islands. Domiciliaries of the Northern Mariana Islands (CNMI) became U.S. citizens automatically in 1986 when it became a U.S. commonwealth unless they opted within six months of that date (or six months after reaching age 18 if later) to become U.S. nationals instead. Individuals born in CNMI after January 9, 1978 are U.S. citizens by virtue of a covenant between the U.S. and CNMI.

Birthright citizenship does not apply, however, to children born to foreign nationals in the U.S. who are not “subject to the jurisdiction thereof” as required for citizenship by the 14th amendment. Such foreign nationals include individuals who are in the U.S. in an official capacity who are afforded diplomatic immunity, such as foreign diplomats, consular officers, and employees of international organizations of which the U.S. is a member.

b. Birth to a U.S. Citizen Parent
U.S. citizenship may be conferred on individuals born abroad to a U.S. parent provided they meet the citizenship rules prescribed on their date of birth. Children born abroad are U.S. citizens if they are in one of the following categories:

  1. A child of two U.S. citizen parents provided one parent has resided in the U.S. prior to the child’s birth.
  2. An illegitimate child of a U.S. citizen mother who resided in the U.S. or outlying possessions for at least one continuous year prior to the child’s birth.
  3. An illegitimate child of a U.S. citizen father who certifies in writing to provide support to age 18 provided prescribed rules for proving paternity are followed.
  4. A child of one U.S. citizen parent and one U.S. national parent provided the U.S. citizen parent was a resident of the U.S. or one of its outlying possessions for at least one continuous year prior to the child’s birth.
  5. A child of one U.S. citizen parent and one alien parent provided the prescribed rules in place at the time of birth or as changed by legislation retroactively are met.

The rules for determining the conditions of citizenship for a child born abroad of one citizen parent and one alien parent have changed many times. The laws have included various retention requirements such as failure to come to, reside, or be physically present in the U.S. for a prescribed period of time by a specified age. Various laws were also passed to allow individuals who had lost their U.S. citizenship for failure to meet prescribed retention requirements to regain their citizenship. Determining whether such individuals are U.S. citizens can be a complicated task. However, the holding of a current U.S. passport is good proof of U.S. citizenship for tax purposes.

c. Naturalization
Any eligible alien who has become a U.S. lawful permanent resident (popularly called a green card holder) who is at least 18 years of age may apply for naturalization provided he or she: 1) is of good moral character, and 2) has been a continuous resident of the U.S. for the requisite period after acquiring green-card status, which is 5 years, reduced to 3 years if the applicant is married to a U.S. citizen. The applicant must also demonstrate knowledge of the English language, American history and government.

At least half of the requisite period of residence must be spent physically in the U.S. A continuous absence from the U.S. that is greater than one year following a voluntary departure breaks the continuity of the applicant’s residence. Under certain circumstances, however, an exception may be allowed for permanent residents who resided in the U.S. continuously for at least one uninterrupted year prior to departure who are employed abroad by the U.S. government, a recognized American research institute, an American company or foreign company owned by an American company, or an international organization of which the U.S. is a member (such as the International Monetary Fund).

Under the Child Citizenship Act of 2000, foreign-born children who did not acquire U.S. citizenship at birth, including adoptive children, who meet certain requirements automatically acquire U.S. citizenship when they immigrate to the U.S. The requirements are: 1) at least one parent must be a U.S. citizen by birth or naturalization, 2) the child must be under 18 years of age at the time of the parent’s naturalization, 3) the child must be residing in the legal and physical custody of the citizen parent under a lawful admission for permanent residence, and 4) with regard to an adopted child the adoption must be full and final.