Taxes: Which is the better choice for us, married joint or married se

[larry sellers]

Hello everyone. This is my first post.

Like most people here, we're beginning the green card process and I'm feeling completely overwhelmed by it. Also, we had a horrible experience getting my wife's first tourist visa to visit the US at the Shanghai consulate four years ago, so I'm terrified of doing something wrong with the paperwork.

 

First, here are our vitals...

I'm American, my wife is Chinese (pretty standard here).

I have lived in China since 2002.

We have been in a relationship since 2003, and have been happily married since April 2008.

We do not own property in China.

Regarding taxes, we earn less than $90k per year, so the Foreign Earned Income Exclusion would cover any taxes we would pay if we filed separately or jointly.

We have only worked for Chinese companies.

We do not have any income from the US. All our income comes from China.

My father will be co-sponsoring our green card application (joint affidavit of support).

 

My main concern is regarding taxes. Would it be better to file as "Married, Joint" or "Married, Separate"? I am not sure what the advantage would be if we filed as "Married, Joint", except that it helps to prove a "bona fide" relationship. However, we have lived together since 2004 and have numerous photos, plane tickets, etc. from trips we've taken abroad (4 to the USA, Thailand, Vietnam, Philippines) and from our wedding (which my parents attended in China) and numerous other adventures together, so I'm not too concerned that they'll think our marriage is a fraud (it isn't).

 

Any advice would be greatly appreciated.

[Randy W]

You can save yourself a little bit of ink and arithmetic by filing jointly, but by and large $0 taxes is still $0 taxes.

 

Filing "Married, Filing jointly" "helps to prove a "bona fide" relationship", like you point out.

 

So we're down to saving ink, what is the best way to pay $0, and whether you want one more piece of evidence.

 

Why do you ask?

 

But keep in mind that if you DON'T file, you can lose the Exclusion, and be charged for back taxes and penalties as if you had earned that money in the U.S.

 

What was the "horrible experience" in Shanghai, if you don't mind me asking?

[tsap seui]

Just to back up what you already said, you are working on an immigration visa my man. You load the bases with every shred of info you can find or dream up to prove your case.

 

Losing your exclusion or not doesn't matter here...You file married-joint for the immigration visa purposes.

 

Good luck.

 

tsap seui

[larry sellers]

Thanks for the speedy replies and frank assessment, friends. Joint is the route we'll go. I have zero faith in government bureaucrats and want to give them no reason whatsoever to reject our application. Just curious, has anyone gotten a rejection because they filed separately?

Regarding the Shanghai consulate experience, the woman looked at my passport, saw that it was a business visa and not a z-visa, threw it back at my wife, rejected her without looking at any of our other info (wedding photos, tickets and photos from trips abroad, etc.), and then said "You Chinese girls just want to go to the US so you can work in a Chinese restaurant." My wife, who is college educated, was in tears afterwards and I was seeing red. It took a career change and 13 more months to finally get a tourist visa to visit the US, and that was only because I went to the weekly visa help hour session at the consulate and basically ordered the kid taking questions to enter into the computer that we had changed our circumstances and met the requirements.

I'm sure I will have more questions in the future. Thanks for indulging me.

[tsap seui]

Thanks for the speedy replies and frank assessment, friends. Joint is the route we'll go. I have zero faith in government bureaucrats and want to give them no reason whatsoever to reject our application. Just curious, has anyone gotten a rejection because they filed separately?

Regarding the Shanghai consulate experience, the woman looked at my passport, saw that it was a business visa and not a z-visa, threw it back at my wife, rejected her without looking at any of our other info (wedding photos, tickets and photos from trips abroad, etc.), and then said "You Chinese girls just want to go to the US so you can work in a Chinese restaurant." My wife, who is college educated, was in tears afterwards and I was seeing red. It took a career change and 13 more months to finally get a tourist visa to visit the US, and that was only because I went to the weekly visa help hour session at the consulate and basically ordered the kid taking questions to enter into the computer that we had changed our circumstances and met the requirements.

I'm sure I will have more questions in the future. Thanks for indulging me.

 

I'm sorry to hear the experience your wife had with an American bureaucrat, yet I'm glad to see you well understand the idiocy of those clowns, Larry, especially with something as serious as immigration from China. The State Department is loaded with speculative "gods" who live by their speculations and conjectures...with absolutely no oversight on them, all covered up with the two most terroristic words known to mankind....Homeland Security.

 

Just cover every base with your initial application, no matter how large it grows. The initial application is the only time you will really have any input on this matter as the interview is pretty much decided upon before your wife leaves her seat for the interview window.

 

Good luck, your wife should be just fine as DCF's have the best success rate. Just never let your guard down or take anything for granted with this bureaucratic entity who considers your wife guilty until proven innocent....they make you wait 2 years to prove your innocence.

 

tsap seui

[Randy W]

Thanks for the speedy replies and frank assessment, friends. Joint is the route we'll go. I have zero faith in government bureaucrats and want to give them no reason whatsoever to reject our application. Just curious, has anyone gotten a rejection because they filed separately?

Regarding the Shanghai consulate experience, the woman looked at my passport, saw that it was a business visa and not a z-visa, threw it back at my wife, rejected her without looking at any of our other info (wedding photos, tickets and photos from trips abroad, etc.), and then said "You Chinese girls just want to go to the US so you can work in a Chinese restaurant." My wife, who is college educated, was in tears afterwards and I was seeing red. It took a career change and 13 more months to finally get a tourist visa to visit the US, and that was only because I went to the weekly visa help hour session at the consulate and basically ordered the kid taking questions to enter into the computer that we had changed our circumstances and met the requirements.

I'm sure I will have more questions in the future. Thanks for indulging me.

 

 

The tax returns are just one piece of evidence - it sounds like in your case, no it wouldn't make any difference. Some have even filed single, with the intention of filing an amended return after their wife arrives in the states and gets an SS number.

 

Yes you are FILING and don't have to worry about losing the Exemption - You don't want to end up paying taxes and penalties when you would have owed zero tax.

[2mike&jin]

Larry;

 

At the risk of sounding too pedantic, I looked twice at your posts and I don't see a definitive place where you state whether you "have" or "have not" been filing your taxes each year. Let's say that you have filed and reported all of your worldwide income each and every year - as you are required to by law. When you produce the last three years of tax forms they will see that you have either filed single and married or joint and married. Any other filing status, i.e. single, would be in error, since the first year of your marriage. As we say, the sun never sets on the long arm of the US Internal Revenue Service.

 

If you have filed joint/married - then I suppose you wouldn't have asked the question.

 

So that brings us to the last possibility - you possibly haven't filed any tax returns since being in China since 2003, and specifically none since you were married. If this is the fact, then I think you have a significant problem only not only with the application to bring you wife to the US but with the IRS upon your return to the US. I hope this is not the case.

 

If I missed the intent of you post or the fact that you "have filed each year" I apologize for it, but we see so many folks here that think because so much of their income "Could be excluded" on their overseas income that they fail to report of file income taxes - thus setting themselves up for serious IRS complications as well as the resultant VISA issues.

 

Best of Luck to you in your endeavors

[sammysensei]

Perhaps this should be on a new topic, but I'm newly married (Sept 2012) and preparing to file my tax returns for the first time with my Chinese wife. Is there a specific document I should use with her, since she does not have a social security number?

 

Additional details: been in China for three years, filing my taxes faithfully, and just started the CR-1 visa last year.

 

Thanks in advance!

 

Sammy

[Randy W]

Perhaps this should be on a new topic, but I'm newly married (Sept 2012) and preparing to file my tax returns for the first time with my Chinese wife. Is there a specific document I should use with her, since she does not have a social security number?

 

Additional details: been in China for three years, filing my taxes faithfully, and just started the CR-1 visa last year.

 

Thanks in advance!

 

Sammy

 

She will need to file a W-7 with the return to get an ITIN taxpayer Identification Number - http://www.irs.gov/uac/Form-W-7,-Application-for-IRS-Individual-Taxpayer-Identification-Number

 

Be sure to follow the instructions about WHERE to file the return, since the IRS mailing address is different for those returns that include a W-7.

[Fu Lai]

Does my wife have to file a W-7 and apply for an ITIN? She works for a government university and has never been or lived in the USA (no plans to either).

[Randy W]

Does my wife have to file a W-7 and apply for an ITIN? She works for a government university and has never been or lived in the USA (no plans to either).

 

 

No - nobody does. You can use her as a deduction and exemption, though, only if she has an ITIN

 

Your income is probably entirely excludable under by Form 2555 either way. It's your choice.

 

My understanding is that you CAN file singly, or married, filing separately without an ITIN, as long as filing singly DOESN'T result in a lower tax bill - this will usually be the case if the foreign spouse has no income.

 

When you use the Form 2555, there's an alternate calculation for income tax - see the Form 1040 instructions Foreign Earned Income Tax Worksheet. But. like I said, your tax will most likely be $0, unless you also had some American-sourced income.

[sammysensei]

Randy,

 

Sorry for the extremely late reply, but thanks for your response. Getting ready to finish filing my returns for 2012 currently.

 

I have a new wrinkle now...according to the 2012 ITIN application FAQ, they will no longer be accepting notarized copies of a foreign (i.e. Chinese) passport. I'm not sure of the next step now, as I read before that the IRS will not accept China-based notaries either.

 

I'm wondering if I should file singly instead of jointly, as my wife has never worked in the US. Will this impact our immigration process for the interview coming soon (even next month, maybe)?

 

I've been being paid via my US company, though I've been working at their Chinese branch for the past three years. Still under the tax exclusion umbrella, however.

 

Thanks in advance for any help!

[sammysensei]

Forgot to mention: here's a link to the interim rules being enacted for 2012.

 

http://www.irs.gov/uac/2012-ITIN-Review-Frequently-Asked-Questions-1

[Randy W]

The "interim period" was over at the end of the year (in Dec., 2012).

 

You need to get her passport copy CERTIFIED (not simply notarized) - you can do this in the U.S., or at one of the U.S. consulates in China. I'll see if I can find the link for that

[Randy W]

I believe it's covered under this clause of the Internal Revenue Manual, dated Jan. 2, 2013 -

 

 

http://www.irs.gov/irm/part3/irm_03-021-263r-cont01.html

 

Part 3. Submission Processing Chapter 21. International Returns and Documents Analysis Section 263. IRS Individual Taxpayer Identification Number (ITIN) Real-Time System (RTS) (Cont. 1) 3.21.263.5.3.4.2.1 (01-02-2013)
Supporting Identification Documentation Certification Requirements

If a U.S. Consul/Embassy certifies a copy of a foreign document, accept it as valid. U.S. Consul employees may certify the document itself or attach a separate authentication sheet (usually attached with an eyelet grommet). Examples of Consul authentication include Consul stamps, seals, ribbons, wafers, wax, and eyelet grommets.

 

The clause I quoted is under the "Comments" column of Table 3

 

Contact her consulate about making an appointment to get this done (it falls under "American Citizen Services", and she won't have any trouble getting admitted to the consulate with a printed appointment letter).

Edited July 2, 2013 by Randy W (see edit history)