If you’re an Australian living, working, or investing in the United States—or even just earning US-sourced income—understanding your tax obligations is non-negotiable. IRS Publication 519, also known as the US Tax Guide for Aliens, is the definitive resource for foreign nationals navigating the labyrinth of American tax rules. In 2025, with cross-border tax enforcement at an all-time high, this publication is more relevant than ever for Australians with ties to the US tax system.
What Is IRS Publication 519 and Who Needs It?
IRS Publication 519 is the Internal Revenue Service’s official guide for non-US citizens (“aliens”) with potential US tax responsibilities. Whether you’re an Aussie expat, a dual citizen, or simply investing in US property, this publication demystifies how residency status is determined, what income is taxable, and which forms you’ll need to file.
- Determining Residency: Explains the green card and substantial presence tests, which decide if you’re taxed as a resident or nonresident alien.
- Income Reporting: Details what types of US and worldwide income you must report, and where to report them.
- Tax Treaty Benefits: Shows how to claim treaty exemptions or reduced rates (including under the Australia-US tax treaty).
For Australians, this means Publication 519 is your roadmap to avoiding double taxation and costly compliance errors.
2025 Updates: What’s New for Australians?
The US tax landscape is always evolving, and 2025 brings several notable changes that affect Australian expats and investors:
- Digital Asset Reporting: The IRS has ramped up requirements for reporting digital assets and cryptocurrencies, a hot topic for tech-savvy Australians.
- Stricter Residency Scrutiny: In 2025, US Customs and IRS databases are more integrated, making it harder to fly under the radar if you spend significant time stateside.
- FATCA Enforcement: The Foreign Account Tax Compliance Act (FATCA) continues to drive information sharing between Australian banks and the IRS, so unreported offshore accounts are riskier than ever.
- Updated Tax Treaty Guidance: Publication 519 now includes clearer instructions for Australians on how to invoke treaty benefits, including the exemption on US Social Security tax for eligible temporary residents.
Failing to follow these updates can mean penalties, audits, or even jeopardising your US visa status.
Key Scenarios for Australians: Real-World Examples
Let’s look at how IRS Publication 519 applies in practical terms for Australians with US connections in 2025:
- Expatriate Employees: Sarah, an Aussie tech executive in Silicon Valley, uses Publication 519 to determine if she’s a resident alien for tax purposes based on her days in the US. She avoids double-taxation by correctly applying the Australia-US tax treaty rules.
- Investors with US Rental Property: John owns a rental apartment in New York. Publication 519 explains how to report rental income, claim allowable deductions, and apply for a reduced withholding rate under the treaty.
- Frequent Travellers: Priya splits her time between Sydney and Los Angeles for business. The substantial presence test in Publication 519 helps her count her US days and avoid accidentally triggering resident alien tax status.
Each scenario shows the importance of getting residency and tax reporting right—the difference between a simple return and a costly compliance headache.
Practical Steps: Staying Compliant in 2025
To stay ahead of the US tax curve, Australians should:
- Review IRS Publication 519 annually for updates relevant to residency, treaty claims, and new reporting rules.
- Keep detailed travel and income records to support your residency status and treaty positions.
- Be proactive: File necessary US forms (such as 1040NR, 8938 for foreign assets, and W-8BEN for withholding reductions) on time.
- Monitor ATO and IRS cross-border initiatives, as enforcement is only getting tougher in 2025.
With the right knowledge, you can minimise your tax bill and avoid the stress of an unexpected IRS notice.
