Taxes, Help!!!

[D3m 0]

Publication 519:

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Nonresident Spouse Treated as a Resident

If, at the end of your tax year, you are married and one spouse is a U.S. citizen or a resident alien and the other spouse is a nonresident alien, you can choose to treat the nonresident spouse as a U.S. resident. This includes situations in which one spouse is a nonresident alien at the beginning of the tax year, but a resident alien at the end of the year, and the other spouse is a nonresident alien at the end of the year.

If you make this choice, you and your spouse are treated for income tax purposes as residents for your entire tax year. Neither you nor your spouse can claim under any tax treaty not to be a U.S. resident. You are both taxed on worldwide income. You must file a joint income tax return for the year you make the choice, but you and your spouse can file joint or separate returns in later years.

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[Nicole72082 0]

So, okay, its basically decided that he's going to be claimed as a resident then since we're not saying he's dual status on the tax return, it would be just a normal 1040?

I think since we're not claiming his income from before he moved over (and marriage) we won't be dealing with any tax credits. This actually could be kind of simple.

My sister in law actually is an accountant, she just doesn't work in taxes. She had asked her boss and her recommendation was to read the publication 519, which I tried to do. I just figured if tons of people had been through it before, it would be much easier to ask lol Thank you everyone sooooo very much.

[JVKn'CVO 11]

Yay this thread is just in time, we were trying to figure out taxes yesterday

What I don't understand yet, is the "worldwide income" part.

Our case:

I (alien -> *) worked in Argentina from the beginning of 2007 until october 2007. Got taxed in Argentina for this income (definetly made way less than U$S 80,000! ). Quit my job, came to the US. Did not work for the rest of 2007, no other source of income but hubby's salary.

If we choose the option married filing jointly, for my part, what do I do, declare my earnings in Argentina? declare no earning? if yes, what proof of income will I need?

I read about sending a letter that you choose to be treated as a resident for the year 2007, is that necessary in our case? I already have my SSN.

Thanks!

Saludos,

Caro

*Sorry for the easy joke, I'm feeling goofy

[payxibka 10,045]

Yay this thread is just in time, we were trying to figure out taxes yesterday

What I don't understand yet, is the "worldwide income" part.

Our case:

I (alien -> *) worked in Argentina from the beginning of 2007 until october 2007. Got taxed in Argentina for this income (definetly made way less than U$S 80,000! ). Quit my job, came to the US. Did not work for the rest of 2007, no other source of income but hubby's salary.

If we choose the option married filing jointly, for my part, what do I do, declare my earnings in Argentina? declare no earning? if yes, what proof of income will I need?

I read about sending a letter that you choose to be treated as a resident for the year 2007, is that necessary in our case? I already have my SSN.

Thanks!

Saludos,

Caro

*Sorry for the easy joke, I'm feeling goofy

The first thing you need to do is determine your tax status.... Resident or non-resident alien.... once that is determined then it is easier to answer the balance of the questions.... just from yout timeline information it would appear the answer is non-resident alien but...YMMV

[rin and john 71]

This was discussed a few days ago. Someone linked to a post from two years ago.

http://www.visajourney.com/forums/index.php?showtopic=109

I thought it explained the options very well.

John

[Gaby&Talbert 1]

It isnt that complicated, 2006 return I filled joint and claimed my wife as a dependant with no problems. I applied for an ITIN number because she was still in her home country. She worked but we did not claim her income at all. We got a big refund and no problems!

[JVKn'CVO 11]

The first thing you need to do is determine your tax status.... Resident or non-resident alien.... once that is determined then it is easier to answer the balance of the questions.... just from yout timeline information it would appear the answer is non-resident alien but...YMMV

That's right, non-resident alien

So we know we can make the choice to be treated as a resident and so on, but before we can make that decision, I'd like some clarification on this "taxed for worldwide income", see if it is something that we want and can do

Saludos,

Caro

[Kez/JWolf 6]

Taxed for WorldWide income means that you will have to declare any money earned in any country of the world.... if you paid taxes on it in a country outside the US and the US has a tax treaty with that country you can claim a Foreign Tax Credit, so you dont get taxed twice.... If you did earn income in another country you can claim Foreign Income Exclusion up to $87,500 (see IRS Publication 54)

Do I have to meet the 330-day presence test or have a valid working resident visa to meet the requirement for foreign income exclusion?

To claim the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction, you must have foreign earned income, your tax home must be in a foreign country, and you must be one of the following:

A U.S. citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year,

A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty with a nondiscrimination article in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year, or

A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

http://www.irs.gov/publications/p54/index.html

There is also a very good section to help you decide if you want to be resident or non-resident....

Nonresident Alien Spouse Treated as a Resident

If, at the end of your tax year, you are married and one spouse is a U.S. citizen or a resident alien and the other is a nonresident alien, you can choose to treat the nonresident as a U.S. resident. This includes situations in which one of you is a nonresident alien at the beginning of the tax year and a resident alien at the end of the year and the other is a nonresident alien at the end of the year.

If you make this choice, the following two rules apply.

You and your spouse are treated, for income tax purposes, as residents for all tax years that the choice is in effect.

You must file a joint income tax return for the year you make the choice.

This means that neither of you can claim tax treaty benefits as a resident of a foreign country for a tax year for which the choice is in effect.

You can file joint or separate returns in years after the year in which you make the choice.

http://www.irs.gov/publications/p54/ch01.html#d0e1278

Hope this helps

Kez

[Gaby&Talbert 1]

Taxed for WorldWide income means that you will have to declare any money earned in any country of the world.... if you paid taxes on it in a country outside the US and the US has a tax treaty with that country you can claim a Foreign Tax Credit, so you dont get taxed twice.... If you did earn income in another country you can claim Foreign Income Exclusion up to $87,500 (see IRS Publication 54)

Do I have to meet the 330-day presence test or have a valid working resident visa to meet the requirement for foreign income exclusion?

To claim the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction, you must have foreign earned income, your tax home must be in a foreign country, and you must be one of the following:

A U.S. citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year,

A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty with a nondiscrimination article in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year, or

A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

http://www.irs.gov/publications/p54/index.html

Forget about any money he made while living in another country, just start with what he made here and file a joint return. The IRS is bad but not like USCIS. The IRS is only going to care about what he made while working here.

There is also a very good section to help you decide if you want to be resident or non-resident....

Nonresident Alien Spouse Treated as a Resident

If, at the end of your tax year, you are married and one spouse is a U.S. citizen or a resident alien and the other is a nonresident alien, you can choose to treat the nonresident as a U.S. resident. This includes situations in which one of you is a nonresident alien at the beginning of the tax year and a resident alien at the end of the year and the other is a nonresident alien at the end of the year.

If you make this choice, the following two rules apply.

You and your spouse are treated, for income tax purposes, as residents for all tax years that the choice is in effect.

You must file a joint income tax return for the year you make the choice.

This means that neither of you can claim tax treaty benefits as a resident of a foreign country for a tax year for which the choice is in effect.

You can file joint or separate returns in years after the year in which you make the choice.

http://www.irs.gov/publications/p54/ch01.html#d0e1278

Hope this helps

Kez

[~krakatoa~ 27]

Taxed for WorldWide income means that you will have to declare any money earned in any country of the world.... if you paid taxes on it in a country outside the US and the US has a tax treaty with that country you can claim a Foreign Tax Credit, so you dont get taxed twice.... If you did earn income in another country you can claim Foreign Income Exclusion up to $87,500 (see IRS Publication 54)

Do I have to meet the 330-day presence test or have a valid working resident visa to meet the requirement for foreign income exclusion?

To claim the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction, you must have foreign earned income, your tax home must be in a foreign country, and you must be one of the following:

A U.S. citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year,

A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty with a nondiscrimination article in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year, or

A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

http://www.irs.gov/publications/p54/index.html

Forget about any money he made while living in another country, just start with what he made here and file a joint return. The IRS is bad but not like USCIS. The IRS is only going to care about what he made while working here.

There is also a very good section to help you decide if you want to be resident or non-resident....

Nonresident Alien Spouse Treated as a Resident

If, at the end of your tax year, you are married and one spouse is a U.S. citizen or a resident alien and the other is a nonresident alien, you can choose to treat the nonresident as a U.S. resident. This includes situations in which one of you is a nonresident alien at the beginning of the tax year and a resident alien at the end of the year and the other is a nonresident alien at the end of the year.

If you make this choice, the following two rules apply.

You and your spouse are treated, for income tax purposes, as residents for all tax years that the choice is in effect.

You must file a joint income tax return for the year you make the choice.

This means that neither of you can claim tax treaty benefits as a resident of a foreign country for a tax year for which the choice is in effect.

You can file joint or separate returns in years after the year in which you make the choice.

http://www.irs.gov/publications/p54/ch01.html#d0e1278

Hope this helps

Kez

Thanks, Kez! We need all the help we can get. I'm a bit confused myself.

[TracyTN 237]

Never mind, I can't type. LOL

Edited January 26, 2008 by TracyTN

[Nicole72082 0]

Well, I've done my taxes. We are getting a pretty nice refund, I had my sister in law look at it. She said if Dave had been a resident the whole year, that the whole tax return looks fine. She's just afraid that in time, this could cause me to be audited. She is the type to worry about everything though. I know it could happen to anyone, but just claiming him like a regular resident.. that's not such a bad thing, is it??

[Dr. Obvious 49]

Turbo Tax is pissing me off. I don't want to fill out the 2555, you stupid piece of #######. It is of no advantage for me to do so. Just get over it and let me add my husband's pittance in without automatically filling out the 2555.

Edited February 3, 2008 by Wacken