What Do You Mean My Children Are US Citizens?

Are your children US citizens? If you've not ordered a giant turkey for your family this November and have never made your children a PB&J sandwich you might not think they are, but Uncle Sam (and therefore the IRS) may not agree. This is significant, as US citizens are liable to US federal tax and reporting requirements. In particular, US citizens are liable to US federal income and transfer tax on their worldwide assets by virtue of their US citizenship status and regardless of whether they are tax resident in another country. So who is a US citizen? Pursuant to the 14th Amendment of the US Constitution and the Immigration and Nationality Act ('INA'), US citizenship is granted automatically to any person born within and subject to the jurisdiction of the US (known as the doctrine of jus soli). Individuals born outside the US to a US citizen parent are similarly granted US citizenship automatically if certain requirements are met (known as the doctrine of jus sanguinis).

Though many think they are familiar with the rules of acquiring US citizenship, this complex area of law often prompts questions when it comes to who is liable to US federal tax and reporting requirements. Here are a few of the questions that arise regularly:

Question: My children were born in the United States but my spouse and I are not US citizens (and have never been.) We moved back to England when the children were very young. They have never lived in the US since we moved back to England, and they do not have US passports. Are my children really US citizens?

Answer: Yes. Because your children were born in the US and were subject to its jurisdiction when they were born, they are US citizens under section 301(a) of the INA. Their US citizenship status was not extinguished when your family moved back to England, and their status as US citizens is not affected by the fact that they have not resided in the US since.

They are not required to apply for a US passport, though they must use a US passport if they are traveling to or through the US.

Question: I am US citizen, and my spouse and I live in London. We have had two children together while living in London. Are my children US citizens?

Answer: Your children may be US citizens; the answer to this question will depend on whether you (and your spouse if you are both US citizens) satisfy certain physical presence requirements in the US.

If you and your spouse are both US citizens: Under INA section 301©, if either one of...