Income Tax filing newly married

[boohbah 0]

So from what I understand from this forum, if we write a statement about my hubby being treated as a resident alien in 2008, he needs to write up the exclusion form 2555ez as well.

I called the IRS & they said that all we needed to do was the statement. He said that no other forms or mentioning income were necessary.

Also, I was reading up on the 2555ez & it says something about that if he were to fill that out, we would lose EIC. We have a daughter, so we wouldn't want to lose the credit that she gets. Is there something I am misunderstanding?

This is giving me such a headache.

[Nich-Nick 3,354]

I think everybody needs to read publication 519 for themselves. This forum can't address every single case. It points out some things that may be common to aliens who arrived in the US and married USCs in 2008. I have read the whole publication and picked out the things that apply to me. You can't go strictly by what people from different situations post because you may have other circumstances. I believe this thread should point out possibilites that you need to investigate. Even if you ask the IRS three different times, you could get three different answers, but calling them for help is a good step.

With income tax there are often various situations where you could choose which way you want to go...file married separately, married jointly, head of houshold, file as a non-resident alien, don't file at all if you had no US income....many legal choices. You have to figure out which one results in the lowest tax bill for your family. The best source of lots of information is irs.gov

[tom&tata 2]

So from what I understand from this forum, if we write a statement about my hubby being treated as a resident alien in 2008, he needs to write up the exclusion form 2555ez as well.

I called the IRS & they said that all we needed to do was the statement. He said that no other forms or mentioning income were necessary.

Also, I was reading up on the 2555ez & it says something about that if he were to fill that out, we would lose EIC. We have a daughter, so we wouldn't want to lose the credit that she gets. Is there something I am misunderstanding?

This is giving me such a headache.

The EIC part is correct. You will loose it for using 2555ez.

[kks 0]

Oh great. So the tax people lied to me? Wonderful. I "don't" think I'll be using them this year.

Nich Nick - thx for detailed post. This is similar to what I have researched online as well. However, couple of lingering questions:

1) My wife arrived on K1, we subsequently got married and applied for her AOS. She has an SSN. Do we need to provide a statement asking for us to get treated as resident alien? I thought if you have an SSN, no need to provide statement. Please clarify.

2) If we have to file statement, can we do this through filing taxes through taxact.com or turbo tax, who file taxes electronically? Please let me know.

I appreicate you taking time to provide clarity to many of us.

Thanks,

Kunal

[Nich-Nick 3,354]

To be a resident alien you have to have green card or basically be present in the US for 183 days. If you've got either then you're a resident alien with no statement. That should cover anybody who got here by roughly July 1. Done deal. File joint like an American and e-file.

(There's this complicated test of presence whereby if you're a few days short you can get some days from being in the US in 2006 and 2007. Just read about that if you need fine technicalities to qualify. It doesn't apply to me so I didn't study it)

If you don't meet one of the tests (green card or presence) then you are a non-resident alien. This is where the statement comes in. You can "elect" or choose to be treated as a resident alien for tax purposes if you are married to a US citizen and you both sign a statement. Then you just file like an American would, but if alien earned income abroard in 2008 it has to be claimed as wages and later deducted using Form 2555. A little more complicated but what you have to do if you got here the last half of 2008 and still want to file joint. I don't believe e-file allows for personal statements to be submitted, so that's why you have to mail. It will take you a few weeks longer to get a refund but could be some extra bucks...like claiming the alien's $600 rebate from last year and getting that extra exemption to reduce your taxes, thus increase your refund.

Anybody who needs to "elect" to be resident alien, see this publication http://www.irs.gov/pub/irs-pdf/p519.pdf

Skip to page 10, middle column and then top of third column talks about the statement.

If you are getting other government benefits then the extra income from the spouse might affect it, so it's best to try it both ways

1. Filing joint or

2. USC files "married filing separately" and alien doesn't file if they had no US income.

Edited February 1, 2009 by Nich-Nick

[Cecile and Bryan 0]

If you don't meet one of the tests (green card or presence) then you are a non-resident alien. This is where the statement comes in. You can "elect" or choose to be treated as a resident alien for tax purposes if you are married to a US citizen and you both sign a statement. Then you just file like an American would, but if alien earned income abroard in 2008 it has to be claimed as wages and later deducted using Form 2555. A little more complicated but what you have to do if you got here the last half of 2008 and still want to file joint. I don't believe e-file allows for personal statements to be submitted, so that's why you have to mail. It will take you a few weeks longer to get a refund but could be some extra bucks...like claiming the alien's $600 rebate from last year and getting that extra exemption to reduce your taxes, thus increase your refund.

We tried to use TaxCut yesterday (I believe it's tax cut, the online software of H&R Block) and it would not let me claim my foreign income for form 1040 because it asks the information of an American W2, with the EIN of the company, etc. Of course my former French employer does not have an EIN. So I am wondering if we really have to fill out everything manually and can't use any software. We just wanted to fill out the form with the software and then print them, not e-file.

Also, when we tried to claim the $600 rebate for me (we said my husband got $600, I got $0) it ended up telling us that we were supposed to receive $600 and that our credit is $0. Weird...

[tom&tata 2]

If you don't meet one of the tests (green card or presence) then you are a non-resident alien. This is where the statement comes in. You can "elect" or choose to be treated as a resident alien for tax purposes if you are married to a US citizen and you both sign a statement. Then you just file like an American would, but if alien earned income abroard in 2008 it has to be claimed as wages and later deducted using Form 2555. A little more complicated but what you have to do if you got here the last half of 2008 and still want to file joint. I don't believe e-file allows for personal statements to be submitted, so that's why you have to mail. It will take you a few weeks longer to get a refund but could be some extra bucks...like claiming the alien's $600 rebate from last year and getting that extra exemption to reduce your taxes, thus increase your refund.

We tried to use TaxCut yesterday (I believe it's tax cut, the online software of H&R Block) and it would not let me claim my foreign income for form 1040 because it asks the information of an American W2, with the EIN of the company, etc. Of course my former French employer does not have an EIN. So I am wondering if we really have to fill out everything manually and can't use any software. We just wanted to fill out the form with the software and then print them, not e-file.

Also, when we tried to claim the $600 rebate for me (we said my husband got $600, I got $0) it ended up telling us that we were supposed to receive $600 and that our credit is $0. Weird...

We looked at tax act because there was an option for foreign earned income. Maybe try their online version & see if you can use it. I don't remember using it as I used foreign tax credit instead

Edited February 2, 2009 by tom&tata

[Cecile and Bryan 0]

Thanks I will try this one.

[Nich-Nick 3,354]

We tried to use TaxCut yesterday (I believe it's tax cut, the online software of H&R Block) and it would not let me claim my foreign income for form 1040 because it asks the information of an American W2, with the EIN of the company, etc. Of course my former French employer does not have an EIN. So I am wondering if we really have to fill out everything manually and can't use any software. We just wanted to fill out the form with the software and then print them, not e-file.

Also, when we tried to claim the $600 rebate for me (we said my husband got $600, I got $0) it ended up telling us that we were supposed to receive $600 and that our credit is $0. Weird...

I've bought my TurboTax and done my return so can help out a little here.

I was puzzled at first by how to show the foreign income. Going to post some things about TurboTax copied from a post I made in the AOS thread, so I don't have to write it all again. Perhaps you can use the tips for other software programs.

On the income part I entered my W2 info. Then you have to enter W2 info for Nick (UK). Well you get started by listing his income converted to US $. There's nothing to fill out but income, no other boxes like withholding, medicare, etc. At some point you say it is foreign income and you don't have a real W2 for him. So TurboTax asks if you need to complete a substitute W2 and takes you magically to another form 4852. I filled out the info on the UK employer. It asks " How did you determine the amounts?" I said from UK payslip records and that pounds sterling were converted to US dollars. Next question says to to "explain your efforts to obtain a W2 from this employer." I said " None. It is a United Kingdom employer. They do not issue US tax forms." You have to remember this form would be for anybody that might not have gotten a W2 from a regular US company so it tends to read American. It's not strictly for a person with a foreign employer. So I answered best that I could.

Then Turbo Tax will ask if you want to exclude the foreign income and takes you magically to Form 2555. Skip all the part about her rent and excluding the cost of her residence. It's not something you exclude. Foreign income up to $87600 can be excluded. That's for a whole year in the foreign country. Somewhere TurboTax asked when Nick left UK or maybe it was enter US. Anyway that's because they determine he only was a UK resident about 3/4 of the year. So they use the dates and only give him 75% of that $87,600 exclusion. Not a problem because he only worked 8 months of the year so was only reporting part of a year's salary. So using some hypothetical numbers, lets say Nick earned $40k in the UK. After you finish the substitute W2 and the Form 2555 for foreign income exclusion, the Tax return 1040 will look like this:

Line 7: will include my income plus Nicks $40k

Line 21 Other income: will have written in by TurboTax FORM 2555 and the amount will say -40,000

That's minus so it subtracts it off again.

I'm not sure what happened with the rebate credit. You have to mark "married filing joint" when you start. Your filing status has to be different from 2007 to get it. Since this is a "newly married" thread, it's assumed people were filing "single" in 2007 and "married filing jointly" in 2008. Maybe those two things might help you figure out if missed something. If you filed joint in 2007, you don't qualify.

Edited February 2, 2009 by Nich-Nick

[Cecile and Bryan 0]

I've bought my TurboTax and done my return so can help out a little here.

I was puzzled at first by how to show the foreign income. Going to post some things about TurboTax copied from a post I made in the AOS thread, so I don't have to write it all again. Perhaps you can use the tips for other software programs.

On the income part I entered my W2 info. Then you have to enter W2 info for Nick (UK). Well you get started by listing his income converted to US $. There's nothing to fill out but income, no other boxes like withholding, medicare, etc. At some point you say it is foreign income and you don't have a real W2 for him. So TurboTax asks if you need to complete a substitute W2 and takes you magically to another form 4852. I filled out the info on the UK employer. It asks " How did you determine the amounts?" I said from UK payslip records and that pounds sterling were converted to US dollars. Next question says to to "explain your efforts to obtain a W2 from this employer." I said " None. It is a United Kingdom employer. They do not issue US tax forms." You have to remember this form would be for anybody that might not have gotten a W2 from a regular US company so it tends to read American. It's not strictly for a person with a foreign employer. So I answered best that I could.

Then Turbo Tax will ask if you want to exclude the foreign income and takes you magically to Form 2555. Skip all the part about her rent and excluding the cost of her residence. It's not something you exclude. Foreign income up to $87600 can be excluded. That's for a whole year in the foreign country. Somewhere TurboTax asked when Nick left UK or maybe it was enter US. Anyway that's because they determine he only was a UK resident about 3/4 of the year. So they use the dates and only give him 75% of that $87,600 exclusion. Not a problem because he only worked 8 months of the year so was only reporting part of a year's salary. So using some hypothetical numbers, lets say Nick earned $40k in the UK. After you finish the substitute W2 and the Form 2555 for foreign income exclusion, the Tax return 1040 will look like this:

Line 7: will include my income plus Nicks $40k

Line 21 Other income: will have written in by TurboTax FORM 2555 and the amount will say -40,000

That's minus so it subtracts it off again.

I'm not sure what happened with the rebate credit. You have to mark "married filing joint" when you start. Your filing status has to be different from 2007 to get it. Since this is a "newly married" thread, it's assumed people were filing "single" in 2007 and "married filing jointly" in 2008. Maybe those two things might help you figure out if missed something. If you filed joint in 2007, you don't qualify.

Thanks for the help.

For the rebate credit, last year he filed single (and I didn't file since in France) and this year we file Married filing jointly, and yes we marked it from the beginning. So I really don't understand why it didn't work.

The process for the W2 seems a little different with Tax Cut and Turbo Tax, we click on "add a W2" and then they ask all the info: name address company, EIN, income, wages, etc but if we leave an important question unanswered (EIN) we just can't go to the next page. I will look again to see if there's anything about 'missing W2'. If not, well, we will try a different software I guess!

[Nich-Nick 3,354]

I used taxcut years ago and every year they change up how the tax programs look and operate, but.....

See if you can get out of the interview section and go straight to a "forms" view. It will bring up a form and you fill it in. So if it brings up a W2 looking form, just fill in the employer French Company and perhaps an address, then Box 1. Then see if it helps you. Or alternativly search in the forms list for Form 4852, which is the substitute W2 and try a go at filling that in as a form. Then see if anything in the return changed.

[rin and john 71]

We tried to use TaxCut yesterday (I believe it's tax cut, the online software of H&R Block) and it would not let me claim my foreign income for form 1040 because it asks the information of an American W2, with the EIN of the company, etc. Of course my former French employer does not have an EIN. So I am wondering if we really have to fill out everything manually and can't use any software. We just wanted to fill out the form with the software and then print them, not e-file.

Also, when we tried to claim the $600 rebate for me (we said my husband got $600, I got $0) it ended up telling us that we were supposed to receive $600 and that our credit is $0. Weird...

I've bought my TurboTax and done my return so can help out a little here.

I was puzzled at first by how to show the foreign income. Going to post some things about TurboTax copied from a post I made in the AOS thread, so I don't have to write it all again. Perhaps you can use the tips for other software programs.

On the income part I entered my W2 info. Then you have to enter W2 info for Nick (UK). Well you get started by listing his income converted to US $. There's nothing to fill out but income, no other boxes like withholding, medicare, etc. At some point you say it is foreign income and you don't have a real W2 for him. So TurboTax asks if you need to complete a substitute W2 and takes you magically to another form 4852. I filled out the info on the UK employer. It asks " How did you determine the amounts?" I said from UK payslip records and that pounds sterling were converted to US dollars. Next question says to to "explain your efforts to obtain a W2 from this employer." I said " None. It is a United Kingdom employer. They do not issue US tax forms." You have to remember this form would be for anybody that might not have gotten a W2 from a regular US company so it tends to read American. It's not strictly for a person with a foreign employer. So I answered best that I could.

Then Turbo Tax will ask if you want to exclude the foreign income and takes you magically to Form 2555. Skip all the part about her rent and excluding the cost of her residence. It's not something you exclude. Foreign income up to $87600 can be excluded. That's for a whole year in the foreign country. Somewhere TurboTax asked when Nick left UK or maybe it was enter US. Anyway that's because they determine he only was a UK resident about 3/4 of the year. So they use the dates and only give him 75% of that $87,600 exclusion. Not a problem because he only worked 8 months of the year so was only reporting part of a year's salary. So using some hypothetical numbers, lets say Nick earned $40k in the UK. After you finish the substitute W2 and the Form 2555 for foreign income exclusion, the Tax return 1040 will look like this:

Line 7: will include my income plus Nicks $40k

Line 21 Other income: will have written in by TurboTax FORM 2555 and the amount will say -40,000

That's minus so it subtracts it off again.

I'm not sure what happened with the rebate credit. You have to mark "married filing joint" when you start. Your filing status has to be different from 2007 to get it. Since this is a "newly married" thread, it's assumed people were filing "single" in 2007 and "married filing jointly" in 2008. Maybe those two things might help you figure out if missed something. If you filed joint in 2007, you don't qualify.

I think there are some discrepancies in what the IRS says and what they have in their 1040 instructions. Take a look at the rebate recovery information on their website and then their instructions for the 1040 (page 62).

http://www.irs.gov/pub/irs-pdf/i1040.pdf

It would appear that line 4 would exclude anyone other than a member of the Armed Forces from receiving the recovery rebate. In all their other literature, they indicate anyone who did not receive the rebate in 2008 but now qualifies (see instructions on page 61 of the instructions) can get the rebate. If the tax software people simply entered the formula from the worksheet shown, many people who qualify for the recovery rebate would not get it.

Edited February 2, 2009 by rin and john

[Nich-Nick 3,354]

I am so glad you mentioned that. When I started reading tax documents a few weeks ago, I thought to myself "This information is a misprint." I saw that chart and felt like whoever did the chart goofed up.

To Cecile--The rebate comes in on Line 70 of the 1040. But maybe H&R Block have a problem in their software. If it's online, it should be up to date. If purchased, maybe you could check for updates??

[Cecile and Bryan 0]

I am so glad you mentioned that. When I started reading tax documents a few weeks ago, I thought to myself "This information is a misprint." I saw that chart and felt like whoever did the chart goofed up.

To Cecile--The rebate comes in on Line 70 of the 1040. But maybe H&R Block have a problem in their software. If it's online, it should be up to date. If purchased, maybe you could check for updates??

It is online. We will take a look again when Bryan comes back from work. Maybe there is something that we did wrong (although I doubt it) I will let you know after we check.

[Slightly Bonkers 0]

Hey guys,

I'd like to get to grips with some of this myself, I've read through 519. Can you guys suggest any others that I should be looking out for?

Thanks