IM confused and so is my accountant

[InnaV 0]

So my new wife as of 7 months ago and i are trying to file our taxes. she was on a j-1 visa and we got married in june of 2011. we then file for adjustment of status and she got her green card. We want to file our taxes jointly this year because it will get us the largest tax return. I talked to the guy with the IRS and he said if we filed jointly she would have to pay SS and medicare. But her host family would be responsible for half since they were her employer. He didnt withhold any money from her paychecks. How can we pay our half and get him to pay his half? any advice at all would be appreciated. sorry if i posted this in the wrong section.

[Gary and Alla 3,694]

So my new wife as of 7 months ago and i are trying to file our taxes. she was on a j-1 visa and we got married in june of 2011. we then file for adjustment of status and she got her green card. We want to file our taxes jointly this year because it will get us the largest tax return. I talked to the guy with the IRS and he said if we filed jointly she would have to pay SS and medicare. But her host family would be responsible for half since they were her employer. He didnt withhold any money from her paychecks. How can we pay our half and get him to pay his half? any advice at all would be appreciated. sorry if i posted this in the wrong section.

This is "tax 101" I am shocked an "accountant" would be confused.

IF she were employed as an "Employee" the employer is required to withold payroll tax AND to deposit that tax into an IRS account that the employer holds. If the employer does notdo that, then it is HIS problem, not yours. Simply tell him to hand over the w-2 form.

IF she were employed as an "independent contractor" then it is her responsibility to file a schedule C, profit or loss from business, and pay the Self Employment tax of 15.2% on all profit. Very simple. If she was an independent contractor this person (employer,actually "client") needs to file a 1099 with the IRS and give her a copy.

IF she was being paid cash or personal check "under the table" then...cash is cash, a wonderful thing to have for many purposes.

I presume she is an LPR and that her status is based on marriage so she MUST file a tax return, either jointly with you or singly by herself.

which is her situation? Fill out the forms accordingly

[InnaV 0]

This is "tax 101" I am shocked an "accountant" would be confused.

IF she were employed as an "Employee" the employer is required to withold payroll tax AND to deposit that tax into an IRS account that the employer holds. If the employer does notdo that, then it is HIS problem, not yours. Simply tell him to hand over the w-2 form.

IF she were employed as an "independent contractor" then it is her responsibility to file a schedule C, profit or loss from business, and pay the Self Employment tax of 15.2% on all profit. Very simple. If she was an independent contractor this person (employer,actually "client") needs to file a 1099 with the IRS and give her a copy.

IF she was being paid cash or personal check "under the table" then...cash is cash, a wonderful thing to have for many purposes.

I presume she is an LPR and that her status is based on marriage so she MUST file a tax return, either jointly with you or singly by herself.

which is her situation? Fill out the forms accordingly

i talked to a guy with the irs for an hour the other day. he said we could either file separately(she would not be responsible for ss and medicare) but if we file jointly she will have to pay ss and medicare. since she was an aupair before we got married i dont think her host family was supposed to be withholding anything. I MAY BE WRONG<<<< anyway he didnt withhold anything. how would we go about paying her ss and medicare and how would we get her host family to pay their half. sorry if this isnt very clear

[Gary and Alla 3,694]

i talked to a guy with the irs for an hour the other day. he said we could either file separately(she would not be responsible for ss and medicare) but if we file jointly she will have to pay ss and medicare. since she was an aupair before we got married i dont think her host family was supposed to be withholding anything. I MAY BE WRONG<<<< anyway he didnt withhold anything. how would we go about paying her ss and medicare and how would we get her host family to pay their half. sorry if this isnt very clear

Her filing status, separate or joint, HAS NOTHING to do with her paying social security and medicare taxes. ALL people pay that on ALL earned income. Either you misunderstood the guy from the IRS or he misunderstood you. I assure you HOW she files has nothing to do with that. If a person is employed as an employee, the employer pays HALF. If the person is employed as an independent contractor that person pays ALL. You have told me nothing to indicate it is the responsibility of her employer to pay ANY of this. In what status was she employed and HOW was she paid? Was her income reported to the IRS by either a w-2 or 1099?

If you answer those two questions I can tell you exactly what to do.

[InnaV 0]

Her filing status, separate or joint, HAS NOTHING to do with her paying social security and medicare taxes. ALL people pay that on ALL earned income. Either you misunderstood the guy from the IRS or he misunderstood you. I assure you HOW she files has nothing to do with that. If a person is employed as an employee, the employer pays HALF. If the person is employed as an independent contractor that person pays ALL. You have told me nothing to indicate it is the responsibility of her employer to pay ANY of this. In what status was she employed and HOW was she paid? Was her income reported to the IRS by either a w-2 or 1099?

If you answer those two questions I can tell you exactly what to do.

the guy with the irs said we had two options since she had 2 different statuses. 1. she could file as if she was an nonresident alien on a j-1 visa(she wouldnt have to pay ss or medicare because she thought she would be leaving) 2. we could file like she was a resident and jointly and we may get a larger return. but her host dad wasnt withholding any money because he thought she was leaving. i know he was supposed to withhold taxes but i dont think he had to withhold ss and medicare because of her status. she was paid in cash. and she was employed when she was on her j-1 status.

[Gary and Alla 3,694]

the guy with the irs said we had two options since she had 2 different statuses. 1. she could file as if she was an nonresident alien on a j-1 visa(she wouldnt have to pay ss or medicare because she thought she would be leaving) 2. we could file like she was a resident and jointly and we may get a larger return. but her host dad wasnt withholding any money because he thought she was leaving. i know he was supposed to withhold taxes but i dont think he had to withhold ss and medicare because of her status. she was paid in cash. and she was employed when she was on her j-1 status.

You cannot just "say she was employed" Being employed as an employee involves a number of documents that both people have to fill out. You HAVE had a job before, right? You filled out papers when you were hired, right? A w-4 form for example. If she did not do this then she was NOT an employee, she was an independent contractor. Now we can get into a whole 'nother discussion about what an independent contractor is legally and under IRS codes but what for? There was nothing withheld, she was paid in cash, she agreed to this, she was a contractor. She is responsible for the 15.2% self employment tax.

Paid in cash.

Sometimes people forget about cash payments, it happens. BUT, answer this first... Was her income as an au pair reported to the IRS by anyone? Either the host family or an organization that sponsored her here? If it was reported officially by the organization that brought her here she would have a copy of this. Did the host family deduct the money they paid her from their tax return? Perhaps as a child care credit? If so, did they report her SSN as the person they paid?

You have only ONE option regarding her filing status. She was MARRIED as of December 31, 2011 I presume she was a permanent resident also, correct? she can file married-joint or married -separate. The guy at the IRS is wrong or is being told wrong information or is misundertanding you. You cannot have TWO statuses. She was a non resident alien or she was a married LPR. In any case YOU were married and you cannot file "single" either. You were not single.

If her income was not reported and not claimed by anyone and it was all in cash...oops. What? Who? Where?

If it was reported or claimed as a credit then you are going to file a joint 1040, schedule C for her business and a schedule SE to calculate the tax she owes for self employment. That will all be combined with whatever tax you had witheld and you may or may not get a tax refund. Unless you have some unusual other tax considerations that method will net you the biggest refund or smallest payment. It is very easy, with computer tax software, to process you return both ways, joint and separate, and see what happens. I always do and so far joint has always been better by a considerable margin.

[LIFE'SJOURNEY 970]

Gary, since the OP isn't answering the question directly, indirectly it looks as if she was issued a 1099.

• It looks as if they want the employer to pay the SS and Medicare so that they can file jointly .
  
• Filing jointly will aid them in two ways a larger refund and it wiill show immigration that they are con-mingling their funds.
  
• What the OP fails to understand is that the employer hired and paid his wife has if she was an independent contractor.
  
• If his wife had completed her job and left to return to her native home she would not be having this IRS issue .
  

Edited March 14, 2012 by LIFE'SJOURNEY

[InnaV 0]

You cannot just "say she was employed" Being employed as an employee involves a number of documents that both people have to fill out. You HAVE had a job before, right? You filled out papers when you were hired, right? A w-4 form for example. If she did not do this then she was NOT an employee, she was an independent contractor. Now we can get into a whole 'nother discussion about what an independent contractor is legally and under IRS codes but what for? There was nothing withheld, she was paid in cash, she agreed to this, she was a contractor. She is responsible for the 15.2% self employment tax.

Paid in cash.

Sometimes people forget about cash payments, it happens. BUT, answer this first... Was her income as an au pair reported to the IRS by anyone? Either the host family or an organization that sponsored her here? If it was reported officially by the organization that brought her here she would have a copy of this. Did the host family deduct the money they paid her from their tax return? Perhaps as a child care credit? If so, did they report her SSN as the person they paid?

You have only ONE option regarding her filing status. She was MARRIED as of December 31, 2011 I presume she was a permanent resident also, correct? she can file married-joint or married -separate. The guy at the IRS is wrong or is being told wrong information or is misundertanding you. You cannot have TWO statuses. She was a non resident alien or she was a married LPR. In any case YOU were married and you cannot file "single" either. You were not single.

If her income was not reported and not claimed by anyone and it was all in cash...oops. What? Who? Where?

If it was reported or claimed as a credit then you are going to file a joint 1040, schedule C for her business and a schedule SE to calculate the tax she owes for self employment. That will all be combined with whatever tax you had witheld and you may or may not get a tax refund. Unless you have some unusual other tax considerations that method will net you the biggest refund or smallest payment. It is very easy, with computer tax software, to process you return both ways, joint and separate, and see what happens. I always do and so far joint has always been better by a considerable margin.

thanks for the help. attitude not necessary though.

[Gary and Alla 3,694]

Gary, since the OP isn't answering the question directly, indirectly it looks as if she was issued a 1099.

• It looks as if they want the employer to pay the SS and Medicare so that they can file jointly .
  
• Filing jointly will aid them in two ways a larger refund and it wiill show immigration that they are con-mingling their funds.
  
• What the OP fails to understand is that the employer hired and paid his wife has if she was an independent contractor.
  
• If his wife had completed her job and left to return to her native home she would not be having this IRS issue .
  

Yes, that is the question I have about the 1099. So far no answer. On your other points...

1. Yes of course. 15.2% of the income is a big tax right off the top, but you cannot just "get the employer to pay it" if she was not an "employee"

2. Agreed on all points.

3. It appears that way, or they just paid cash and the whole thing was unclaimed. Somehow I doubt this, I am guessing the guy paying her wants some sort of deduction or credit, child/dependent care if nothing else. I would! It is also possible the 1099 would come from some other organization, I do not know the arrangement and have no answers on that. If she moved she could have missed a 1099 mailed to her, but the IRS would have it.

4. Agreed. She got married and became an LPR instead. Congratulations. Pay the piper.