Does that mean I'm fooling the US gov?

Question

I'm a foreign student studying in the US. Soon, I'm a launching a website where an American ad agency will handle posting the ads on it from American advertisers and the revenues are supposed to go to my bank account on monthly basis.

The issue is, I am not allowed to make money or work in the US. So, I thought why not link my ad agency account with my home country's account and then transfer the money to my American account as "family support". Does that mean that I'm fooling the US gov by making money on US land when I am not supposed to?

And should I worry about the IRS since I made income but didn't report it even though I'm not an American citizen nor have a green card?

Answer 1

Two things:

First: "fooling" the US government is unlikely. You might evade your obligations in the short term, but eventually the IRS will come knocking. Fact: A lot of international students think they can "fool" the government through using online advertising as a stream of income. The whole "Google AdSense" (and others) shtick is well known. Don't risk what you've achieved so far - it's not worth it.

Second: you can handle all of this legally and appropriately by setting up a company in your home country and establishing the website through it. Yes, you will have expenses for running the company, and you will pay taxes back home on your earnings. Fact: It's cheaper to be honest up front and handle things appropriately, than it is to pay the penalties and fines once you get caught. Edit: As Duff mentions, check with your college to see if there is a way to handle this legally from within the US - it wont hurt to ask.

Regarding the "family support" issues you mention: calling it "family support" changes nothing - a stream of income is coming from somewhere and that's all that matters. Don't risk your situation of living in the US and getting your education completed - play it by the book.

Answer 2

You should look into whether your school offers a service that provides you access to legal counsel and talk to them about your situation. There may be a way to do this legally.

The risks of breaking the law for a few bucks are really severe.

The US is a big country. Will your income show up on the government's radar? Maybe, but we're talking about what is likely a small amount of money, so you're more likely to get away with it. If you get caught, the repercussions will be severe. At a minimum, you may get deported before your education is complete, be banned from re-entering the US for a few years.

I'm sure you and your family worked very hard to get into and pay for a US college -- don't ruin it for a few bucks.

Answer 3

Depends on the amount of money you're talking about. If it's $10 a year (like my site...), then no-one cares, it's not considered an income and is not "work", it's a hobby. You're allowed to have hobbies.

If you pay your whole tuition and living expenses (or a significant part of it) based on this income then you're definitely breaking the law.

Anything in between is a gray area and can be interpreted in any way, depending on intentions, amount of work you put in it, and the plans for the future you have. Better get a professional counsel if you intend to have an income of more than several dollars a months from this thing.