Tax Time

[Steve and Qingqing]

Just one quick question. Now that Im married and will be filing a joint tax return... Is there any other form that I must submit when filing with my new wife? . She has a SSN so we dont need a W-7 form. Im assuming I can file head of household and have two exemptions and thats about it since she never worked here in the States yet...

[mercator]

If she has an SSN, then it seems like you would file like any other couple would. If you are apprehensive, talk to a good tax firm (not HR BLock, etc.).

[Randy W]

Believe it or not, income tax is on the honor system. If you want to claim her as your wife, then you simply claim her as your wife. If they decide to doubt that claim, they will then ask you for proof.

 

In Texas and some other common law states, however, if she lives with you, and you claim she is your wife, then, by golly, she IS your wife. In this case, the tax return would be your proof!

Edited February 3, 2006 by Randy W (see edit history)

[yuehan123]

... Im assuming I can file head of household and  have two exemptions and thats about it since she never worked here in the States yet...

187526[/snapback]

Whoa! Back up the cart. If you are married you have two choices that I know of: married filing jointly or married filing seperately.

 

Head of Household is for dependents like kids or parents or some other 'defined' relatives.

[LeeFisher3]

Before you follow too much free advice, take a look at IRS Publication 519. You will want to pay close attention to page 9 "Choosing Resident Status". If you are not comfortable with this information contact a tax preparer and be sure they are familiar the first year choice for a spouse.

 

This gives a method of making the "first-year choice", but the big qualifier is "Dual Status Alien" which from your timeline appears to be the case, if it were not you would want to wait to file until the proper number of days residency requirement was met.

 

You and your wife must make the choice together and must include a letter, which is defined on page 9. This allows you to file a joint return without any other requirements as best as I can tell.

 

One condition, you can NOT e-file as the letter must accompany your tax return and you must treat her Foreign income as US income.

 

It is important to follow their instructions concerning the first year choice because they do have access to the SSN records which give them access to when she entered the US. Filing jointly without making the choice in writing can only cause you a problem and the letter is too easy to write.

 

Also, remember the IRS has no way of verification of her China income, and come to think of it wasn't she too busy studying English last year to be able to work?

 

This is a template of the letter we used:

 

IRS

<Address of Filing Service Center>

 

mm/dd/yyy

 

RE: Choosing Resident Alien Status ¨C First-Year Choice

 

To Whom It May Concern:

 

I, <her name>, a dual-status alien for the 2005 tax year wish to be treated as a U.S. resident for the entire 2005 tax year. I submit the following information to demonstrate my qualification for making the first-year choice.

 

1. I was a nonresident alien, residing in China, from <date of birth> thru mm/dd/yyyy.

 

2. My continuous residency in the U.S. began on mm/dd/yyyy.

 

3. I married <spouse name>, a U.S. citizen on mm/dd/yyyy.

 

My husband, <spouse name>, joins me in making this choice.

 

<her signature>..........<yourr signature>

<Her Name>...............<Your Name>

SSN: 999-99-9999.......SSN: 999-99-9999

Address.....................Address

City, State Zip............City, State Zip

[Steve and Qingqing]

why would I have to declare her income from her job in China? Do I even have to file jointly for 2005?..

[LeeFisher3]

why would I have to declare her income from her job in China? Do I even have to file jointly for 2005?..

187643[/snapback]

Filing jointly is a case of combining both incomes and deductions on a single tax return. This works very well for some because of the increased deduction provides a larger refurnd.

 

The only way to file jointly this year is to make the first-year choice where you state you desire her to be treated as a US resident for the entire year and a US resident COULD have income to report.

 

Gather up her W-2's and write down all of her income from China that you can recall and use that number for her income. Now didn't she take the entire year off from work to study English before coming to the US?????? Ok, so she didn't work in 2005 so her income is easy to calculate. B)

 

Technically Qingqing is required to file a tax return as a dual status alien, so you need to identify the method that best fits your tax situation. If she files an individual return she can only get a refund on taxes paid, but if you file jointly and combine your deductions you use those against what you both paid.

 

I would wager that filing jointly could net your family an additional $2-3k refund.

[Steve and Qingqing]

She has no W-2s. I have never used a long form to do my taxes. Never took deductions either... telefiled mostly in the past. I guess I need to look into this further.

[Randy W]

You can do the same thing filing jointly - your standard deduction that way is $10,000. Unless you have more than $10,000 itemized deductions, just take the standard deduction.

[LeeFisher3]

She has no W-2s. I have never used a long form to do my taxes. Never took deductions either... telefiled mostly in the past. I guess I need to look into this further.

187865[/snapback]

Steve as she has no W-2's that means no income has been reported to the IRS and if you think real hard and discover she had no income in China. Think hard (hint hint hint), that's right she didn't have any income in China. So the only income to report is YOURS.

 

Do not over think this.

 

Follow the instructions on making the first year choice in Pub 519. Remember the term "Resident Alien" for tax purposes is not the same as the USCIS definition. She arrived in the US in 2004 and she has been in the US for 31 days and not left the US during that time she meets this requirement.

 

Fill out the same tax form you would do in any other year, but put both of you on it filing jointly and then instead of e-filing, print the return, attach the letter and mail it.

[Steve and Qingqing]

Thanks Lee, I will read that publication you mention.

[yuehan123]

Yes, thank you indeed. Somehow I missed the previous discussions about Pub 519.

[mrjones]

I agree with everything Lee wrote. This link provides a nice little summary of the topic in this thread:

 

http://www.finance.cch.com/text/c60s10d039.asp

 

I'll be looking at taxes soon myself (after I mail out the damn AOS package -hopefully Friday). My wife was working full time in China, but her wages were so low (compared to US income) truthfully reporting it, with the foreign tax credit, may work out well.

[hlin]

Doh, I didn't see this post, and had already e-filed my tax return. I guess I will just file a 1040X and append the letter later on, assuming the 2005 publication says you have to do the same thing. I notice the 519 publication is still for 2004 tax return.

[LeeFisher3]

Doh, I didn't see this post, and had already e-filed my tax return. I guess I will just file a 1040X and append the letter later on, assuming the 2005 publication says you have to do the same thing. I notice the 519 publication is still for 2004 tax return.

188646[/snapback]

While it is dated 2004, they have a section called "What's new for 2005", I'd expect the next revision to be for 2006. remember it's a government operation.