Alien Commuters: U.S. Resident Status Without U.S. Residence

Greg Boos J.D.

An earlier version of this article appeared in the 1993-1994 Immigration & Nationality Law Handbook, American Immigration Lawyers Association, Washington, DC, 1993.

Aliens admitted to the United States as lawful permanent residents (LPRs) or as special agricultural workers (SAWs) with temporary residence may reside in either Canada or Mexico and commute to places of employment in the United Sates without loss of immigration status. Such "alien commuter" status may be obtained either at the time of original entry as a resident of the United States, or thereafter, if the alien has LPR or SAW status.

This article reviews the basics of alien commuter status as well as some of its associated benefits and drawbacks. Practitioners can use the alien commuter category to add creativity and flexibility to immigration options available to their clients who reside in Canada and Mexico (particularly those whose employment is relatively close to the border). Alien commuter status allows such clients to retain their foreign residences and proximity to relatives and loved ones, benefit from tax laws on concurrent business concerns in both the United Sates and the home country, and for Canadians, maintain subsidized health insurance coverage and other social benefits.

Status by Tradition

Alien commuters enter the United Sates as special immigrants (INA 101(a)(27)) - a privilege that does not require actual residence in the United States if LPR status has not previously been surrendered or otherwise lost. INA 101(a)(20). The ability to live in a contiguous country and commute to work into the United States is available to both daily and seasonal commuters.

Although there is no specific statutory authority for alien commuter status, the Immigration and Naturalization Service (INS) and predecessor agencies have traditionally permitted resident aliens who reside in contiguous countries to commute to work in the United States. (Note: Contiguous territory is any country sharing a common boundary with the United States; because the nations and territories of the Caribbean are considered "adjacent islands" their citizens are not eligible for commuter status.) In 1985, the last year for which the INS collected statistics, there were almost 50,000 alien commuters traveling between the United States and Mexico, and approximately 7,500 between the United Sates and Canada. With the recent publication of regulations authorizing the expansion of dedicated commuter lanes and other programs to speed border crossing by frequent, low risk travelers, alien commuter status is likely to become even more attractive. For details of these regulations, see the November 1, 1995 Immigration Law Report (ILR).

The administrative practice underlying alien commuter status dates from 1927, when the Bureau of Immigration, then a division of the Department of Labor, ruled that commuters who became immigrants could cross the border without the usual residence restrictions. According to Vol. IV, No. 13 of Interpreter Releases (May 2, 1927), prior to this ruling, non U.S. citizens who habitually crossed the border could obtain identification cards that assured them easy entry and exit, and were not required to conform with quota or other immigration restrictions then in effect. After the Bureau of Immigration's 1927 policy took effect, such aliens seeking to enter the United Sates for purposes of employment had to do so as immigrants. Although native-born Canadians and Mexicans were not subject to quota limitations because they were natives of the Western Hemisphere, they were subject to literacy requirements - a burden which fell more heavily on Mexicans than Canadians. The new policy had an even greater impact on third country aliens resident in Canada or Mexico, generally of European birth, who were subject to quotas. Nearly fifty years later, the Supreme Court in Saxbe v. Bustos, 419 U.S. 65, 74, (1974), upheld the administrative grant of "alien commuter" status based on longstanding tradition and on Congressional acquiescence to the practice.

Current administrative practice regarding alien commuters is set out in the form of regulations and operations instructions (OIs), primarily 8 C.F.R. 211.5 and OI 211.3 and 211.4, which cover how alien commuter status may be gained and lost as well as required documentation. These rules incorporate several administrative court rulings that form the parameters of alien commuter status.

Key Considerations

All alien commuters must have employment in the United States that is "regular and stable." The INS interprets this to mean that the commuter is not required to have full-time employment, but may have part-time or even intermittent work if it is regular and stable. An alien commuter who has been unemployed in the United Sates continuously for more than six months may lose LPR status, despite any entries made into the United States within that six-month period; however, if the unemployment results from a reason beyond the alien's control, such as illness, the alien does not lose resident status. Upon loss of LPR status, the alien must relinquish Form I-151 or I-551, Alien Registration Receipt Card, or I-688, Temporary Resident Card, to an immigration officer.

Potential Benefits

In addition to enjoying unrestricted employment authorization, some alien commuters residing in Canada may avoid paying thousands of dollars in U.S. social security taxes by seeking coverage under the Canadian Pension Plan. Both Canada and the United States have social security systems that are supported through taxation and afford benefits to their respective residents. The U.S.- Canada Totalization Agreement rescues many people who are covered by the Canada Pension Plan from paying U.S. social security tax for work performed in the United States, although there is debate about whether the U.S. Medicare contribution must still be paid by these individuals. Unlike the North American Free Trade Agreement, the Totalization Agreement may also benefit third country nationals who reside in Canada. 

Under the rules of the U.S.- Canada Totalization Agreement, self-employed persons are taxed according to their place of residence, while those who are employed by others are normally taxed based on place of employment. Alien commuters resident in Canada may be employed by others are normally taxed based on place of employment. Alien commuters resident in Canada may be employed in both Canada and the United States. Additionally, when employees are transferred from one country to the other on a temporary assignment of five years or less, they may be still taxed according to their place of normal employment. Thus, self-employed commuters, commuter employees of Canadian businesses transferred to work in the United States for less than five years as well as commuters who work for both a U.S. business and a Canadian business may, under some circumstances, remain exclusively subject to Canada Pension Plan payments and seek exemption from U.S. social security taxes.