Visa holders · From the Philippines
Moving to the US from the Philippines for good limits your Philippine income tax to income earned there.
Leaving to live abroad as an immigrant, or for permanent work, makes you a nonresident citizen under the Philippine Tax Code. You must give the Commissioner of Internal Revenue proof that you intend to live abroad permanently. From the year you leave, rent your Manila condo earns stays taxable there. Philippine donor’s and estate tax still count a citizen’s property wherever it is. The Tax Code charges no exit tax when you go.
Updated · Sources
Once you live and work in the US
- 0%
- of your SSS benefits is taxed by the US, even once you are a US citizen.
- 25%
- is the most the treaty lets the Philippines take from a dividend, if you are no longer a Philippine citizen.
- 7.65%
- of your US pay goes to Social Security and Medicare, as it does for any US employee.
The 7.65% is 6.2% for Social Security, on pay up to $184,500 in 2026, plus 1.45% for Medicare. Medicare adds 0.9% on pay above $200,000.
When does your money in the Philippines reach your US return?
US reporting starts on your residency starting date. From then on, your Philippine accounts, funds and family gifts can each add a US form.
Your US residency has started
A green card makes you a resident alien from your first day in the US as a permanent resident. Without one, the substantial presence test applies, and a newcomer with no recent US days needs 183 days that year. Your arrival year is usually dual-status, with a nonresident part before your start date.
Your Philippine bank and investment accounts top $10,000 combined
Once your Philippine accounts together pass $10,000, you list every one on an FBAR. Savings, checking, time deposit and investment accounts all count. The total uses each account’s maximum value during the year.
Your foreign financial assets pass the Form 8938 thresholds
Filing single in the US, you add Form 8938 once foreign financial assets top $75,000 at any time, or $50,000 on December 31. Married couples filing jointly use $150,000 and $100,000. A condo you own directly does not count.
You own Philippine funds or UITFs
US rules normally treat a Philippine mutual fund as a passive foreign investment company (PFIC). It usually needs a Form 8621 each year, and its dividends never count as qualified dividends. A unit investment trust fund (UITF) may be a PFIC too. Since a bank holds it in trust, it may raise foreign trust questions instead.
Relatives in the Philippines send you over $100,000 in a year
Form 3520 reports a year’s gifts from a nonresident alien and people related to them once the total passes $100,000. The gifts are not income, so no US tax is due on them. A late Form 3520 can bring a penalty of up to 25% of the gifts.
How much Philippine donor’s tax does a gift from your parents cost them?
The Philippines taxes the giver, at 6% of each donor’s gifts above PHP 250,000 in a calendar year.
A PHP 250,000 gift
PHP 0
The whole gift fits inside the yearly exemption.
A PHP 1,000,000 gift
PHP 45,000
The tax is 6% of the PHP 750,000 above the exemption.
A PHP 3,000,000 gift
PHP 165,000
Here the 6% applies to PHP 2,750,000.
A PHP 6,000,000 gift
PHP 345,000
Here the 6% applies to PHP 5,750,000.
Sections 98 and 99(A) of the Tax Code, as amended by RA 10963, set the 6% rate and the yearly exemption. Your other parent is a separate donor, with an exemption of their own. Form 3520 adds both parents’ gifts together, so the two countries count the same money differently.
The US-Philippines tax treaty caps some Philippine taxes on income you keep there, while the US taxes nearly all of it.
Green card holders and other resident aliens owe US tax on their foreign income, including income from the Philippines. The US taxes every row below except SSS benefits.
| The Philippines | The US | |
|---|---|---|
| Dividends from a Philippine company | Up to 25% Article 11(2) | Taxed |
| Interest from a Philippine bank | Up to 15% 10% on bonds issued to the public | Taxed |
| Rent, or a gain on land or a condo | Can tax it Article 7, where the property is | Taxed |
| Gains on Philippine shares | Usually no right to tax Article 14(2); land-rich company shares excepted | Taxed |
| Pension from a private employer | May tax it too Article 18(1), for work done there | Taxed Under the saving clause |
| SSS benefits | Sole right to tax Article 19 | Exempt Even for US citizens |
The Philippine column shows the treaty’s limits. Under Article 6(3), the Philippines may set them aside for its own citizens and apply its domestic rates instead.
Which protections do Filipinos in the US often count on without having them?
Reading the caps as your US rate
The treaty’s ceilings on dividends and interest bind only the Philippines. Article 6(3), the saving clause, keeps the US taxing its residents and citizens under its own law. Relief from paying twice comes from the US foreign tax credit, within its limits.
Expecting a certificate of coverage
The US and the Philippines have no totalization agreement, so no certificate of coverage can keep your US pay in SSS. Your employer withholds Social Security and Medicare from your first paycheck and pays a matching amount. While still a nonresident alien, an F-1 or J-1 student generally owes no Social Security or Medicare tax on work the visa allows.
Keeping the student article after a green card
Article 22 exempts a Filipino student’s grants, gifts from home and up to $3,000 a year of US pay. It lasts up to 5 taxable years. The saving clause keeps it only for students who are neither US citizens nor green card holders. The 2-year article for invited teachers and researchers ends with a green card too.
Assuming PERA and MP2 savings grow tax-deferred
Yearly earnings in a Personal Equity and Retirement Account (PERA) or Pag-IBIG MP2 savings may be taxable in the US. No treaty article covers these accounts, and we found no IRS guidance treating them as tax-deferred. The accounts may also need reporting as foreign assets.
Your SSS benefits stay out of your income on every US return we prepare, under Article 19 of the treaty.
Valim, a US CPA firm, prepares US returns for Filipinos in America, including every account and fund they keep back home. Any Philippine filing stays with your accountant there.
- We prepare each federal and state return, starting with the year your US residency begins.
- We list each Philippine account on your FBAR, and add Form 8938 once you pass its thresholds. We file each Form 8621 your funds need, and your instant quote prices every account and fund up front.
- On Form 1116, we claim a credit for the Philippine tax you owed on dividends, interest or a pension, within its limits.
- We set estimated payments for a Philippine private pension.
- We review your PERA, MP2 and UITF holdings before your US residency starts, weighing each against selling.
- Answering an IRS or state notice about a return we prepared is part of your fee.
- Individual return
- from $195
- Business return
- from $495
We quote a flat fee before work starts. We do not bill hourly.
Which tax questions do Filipinos in the US ask most?
Does the Philippines have a tax treaty with the USA?
Yes: the income tax convention between the two countries has applied since January 1, 1983, and no protocol has amended it. It caps Philippine tax on dividends at 25% and interest at 15%, though the Philippines may set the caps aside for its citizens. Unusually, it lets the Philippines tax a private pension for work done there, even after you move. Its saving clause lets the US tax its residents on most other income as if there were no treaty. The Philippines has no totalization agreement with the US, so Social Security and Medicare apply to your US pay.
How much is the tax of $100,000 in the Philippines?
In pesos, PHP 100,000 of taxable income owes no Philippine income tax, because the first PHP 250,000 a year is taxed at 0%. Above that, the schedule in force since January 1, 2023 rises in steps from 15% to 35%. A $100,000 salary converts to several million pesos. Income between PHP 2,000,000 and PHP 8,000,000 owes PHP 402,500 plus 30% of the excess over PHP 2,000,000. After you emigrate, the Philippines no longer taxes pay you earn in the US.
Are SSS benefits taxable in the US?
No: Article 19 of the treaty makes SSS benefits paid to a US resident taxable only in the Philippines. The saving clause does not override Article 19, which also covers SSS benefits paid to a US citizen, so naturalizing changes nothing. A pension from a private Philippine employer is different, because the US taxes it.
Sources
- US-Philippines income tax convention (IRS text)
- National Internal Revenue Code of 1997 (Philippines), Sections 22, 23, 85, 98 and 104 (Supreme Court E-Library)
- Republic Act No. 10963 (TRAIN), amending NIRC Sections 24(A) and 99 (Supreme Court E-Library)
- 26 U.S.C. § 7701(b), Resident alien definition
- Treas. Reg. § 301.7701(b)-1, Resident alien
- 26 U.S.C. § 102, Gifts and inheritances
- IRS, Instructions for Form 3520 (Rev. December 2025)
- 31 C.F.R. § 1010.350, Reports of foreign financial accounts
- IRS, Instructions for Form 8938
- 26 U.S.C. § 1297, Passive foreign investment company
- 26 U.S.C. § 901, Taxes of foreign countries
- IRS, Instructions for Form 1116
- 26 U.S.C. § 3101, Rate of tax (Social Security and Medicare)
- IRS, Publication 15 (2026), Employer’s Tax Guide
- Social Security Administration, totalization agreements overview
- IRS, Publication 519 (2025), U.S. Tax Guide for Aliens
Reviewed and updated September 2026. General information, not advice for your situation.