Tax return 2012

[X Factor 1,112]

There is a thread I started for how to file with TurboTax, foreign income exclusion, etc., http://www.visajourney.com/forums/topic/412125-turbotax-help-for-joint-filing-2012/

The foreign income is self-reported and converted to US dollars. You don't need any paperwork from the foreign country. It will make a slight difference over filing MFJ without the foreign income, but that is the only way to correctly/legally file jointly. Your other option is Married Filing Separately for the USC and nothing filed for the immigrant who didn't earn money in the US in 2012. Claiming the foreign income MFJ will almost always work out better than MFS.

Correct.

[Jordandawg05 13]

Scroll up to post 7 of this thread. I told you about that. The long explanation is in the other thread.

IRS publication 519 http://www.irs.gov/pub/irs-pdf/p519.pdf see page 9 Choosing Resident Alien Status explains that even though she is a non-resident alien to the IRS (no greencard in 2012) she can be treated as a resident alien for tax purposes for the entire year. There are people on work visas that are non-resident aliens and file a 1040-NR instead of 1040 (different rules) because they earned money in the US. A NR alien can't file a joint return with a resident alien because the money is taxed differently. But if you are married to a USC, you get to be a resident alien for tax purposes if you declare you wish for her to be treated that way. Otherwise no joint filing.

Now read the first thing in column 3 of page 9

If you make this choice, the following rules apply.

• You and your spouse are treated as U.S. residents for the entire year for income tax purposes.

• You and your spouse are taxed on world- wide income.

• You and your spouse must file a joint re- turn for the year of the choice.

• Neither you nor your spouse can make this choice for any later tax year, even if you are separated, divorced, or remarried.

• The special instructions and restrictions for dual-status taxpayers in chapter 6 do not apply to you.

You can read the whole publication 519 for details. I actually printed out the whole thing and read it 3 times and highlighted parts before it made sense the year my husband came. If you choose to make the election for resident alien, then ignore all the chapters dealing with NR aliens because even though to immigration she doesn't have a greencard (permanent residency) the IRS goes by the resident rules for tax purposes. There is also a physical presence test if she spent a certain number of days in the US. See page 5.

Also Pub. 54 has information for Aliens. Maybe you will come up with something different for your specific situation and the length of time she has been here.

So let me see if I understand this, and correct me if i am way off heheh . First, THANK you for all this work and explanation you are doing. That helps a lot of people in this situation.

so first of all, we can file married separately or jointly. If we do separately , more than likely you won't get the maximum refund so you do it jointly. In order to do jointly you have to declare your Foreign Spouse as a resident align for the tax year ( even though they didn’t' have a GC) and you declare your world wide income.

IF we want to exclude my wife's income , then we would file separately correct? you can't file married jointly and 'omit' her earnings over seas ( as that would be not telling the truth and you don't wana do that right?!)

I did follow your steps on the other thread but one more question about declaring my wife as a resident for last year. You mention you have to add the statement to have the non resident spouse as resident. How would I do that if i e file? on turbo tax would i just go all the way through and not e-file and just print all the forms, submit the declaration of resident and mail to IRS?

As far as the explanation as why our refund was off by few hundred dollars when i entered my wife's earnings, i'd have to read that few times as it contained alot of information that i have to sit down at home and study.

Thanks !

[Nich-Nick 3,354]

So let me see if I understand this, and correct me if i am way off heheh . First, THANK you for all this work and explanation you are doing. That helps a lot of people in this situation.

so first of all, we can file married separately or jointly. If we do separately , more than likely you won't get the maximum refund so you do it jointly. In order to do jointly you have to declare your Foreign Spouse as a resident align for the tax year ( even though they didn’t' have a GC) and you declare your world wide income.

Yes. You get various benefits like the extra exemption and extra standard deduction but very little income impact on her behalf because of the exclusion. I did a "what if" to see how our 2012 taxes would come out if filing separately and noticed some other area affected, but I forgot now.

IF we want to exclude my wife's income , then we would file separately correct? you can't file married jointly and 'omit' her earnings over seas ( as that would be not telling the truth and you don't wana do that right?!)

Correct. And since your wife earned zero income in the US, she has no filing requirement. So only you would file Married Filing Separately. She files nothing. I still think your MFS is going to be less of a refund than MFJ, even with the foreign income.

As far as not telling the truth, that is up to you. I always try to follow the requirements, but I also don't think the IRS checks on people that often with random audits when your tax return looks sensible. I've never had an audit and I've filed taxes since the dark ages. But last year my father in law got an audit letter saying he owed more from two years back. What a fiasco. I've done his taxes for about 10 years. His stuff is always the same, but that year he failed to give me a new thing he had invested in so it didn't go on his return. He is elderly and losing his memory and I spent many hours on the phone with the IRS getting permission to speak on his behalf, trying to figure out where this extra interest he earned came from because he never heard of Pershing in NYC. And to top it off trying to convince the IRS that they had made a $10,000 mistake on their form showing why he owed more. I finally got angry with the guy after over 90 minutes explaining it and him not even listening. I told him he was unsatisfactory and I needed to speak to his supervisor. Finally he let me, and in minutes she agreed with me that their calculations needed to be re-worked because the original person at the IRS put in an extra zero that threw the whole thing off by 10k. And she apologized for the error. Yay me! I fought the IRS and won. But it took a long time.

I did follow your steps on the other thread but one more question about declaring my wife as a resident for last year. You mention you have to add the statement to have the non resident spouse as resident. How would I do that if i e file? on turbo tax would i just go all the way through and not e-file and just print all the forms, submit the declaration of resident and mail to IRS?

You can't e-file on you own from home. Paper return this one year. I asked the IRS myself. Twice.

John (Rin and John) says tax preparation companies have to e-file and gave an explanation of how it works, which I dont understand because I've never gone to H&R Block type places. But if you want to save the cost and do your own taxes, then paper file. I don't even know what it costs at a tax preparation place.

As far as the explanation as why our refund was off by few hundred dollars when i entered my wife's earnings, i'd have to read that few times as it contained alot of information that i have to sit down at home and study.

Yes, I tried to explain it simply, but I can't follow things either unless I'm at the computer and have my tax papers in front of me. So most people just say you get to exclude the foreign income which makes you think it doesn't count at all.

[Jordandawg05 13]

Yes. You get various benefits like the extra exemption and extra standard deduction but very little income impact on her behalf because of the exclusion. I did a "what if" to see how our 2012 taxes would come out if filing separately and noticed some other area affected, but I forgot now.

Correct. And since your wife earned zero income in the US, she has no filing requirement. So only you would file Married Filing Separately. She files nothing. I still think your MFS is going to be less of a refund than MFJ, even with the foreign income.

As far as not telling the truth, that is up to you. I always try to follow the requirements, but I also don't think the IRS checks on people that often with random audits when your tax return looks sensible. I've never had an audit and I've filed taxes since the dark ages. But last year my father in law got an audit letter saying he owed more from two years back. What a fiasco. I've done his taxes for about 10 years. His stuff is always the same, but that year he failed to give me a new thing he had invested in so it didn't go on his return. He is elderly and losing his memory and I spent many hours on the phone with the IRS getting permission to speak on his behalf, trying to figure out where this extra interest he earned came from because he never heard of Pershing in NYC. And to top it off trying to convince the IRS that they had made a $10,000 mistake on their form showing why he owed more. I finally got angry with the guy after over 90 minutes explaining it and him not even listening. I told him he was unsatisfactory and I needed to speak to his supervisor. Finally he let me, and in minutes she agreed with me that their calculations needed to be re-worked because the original person at the IRS put in an extra zero that threw the whole thing off by 10k. And she apologized for the error. Yay me! I fought the IRS and won. But it took a long time.

You can't e-file on you own from home. Paper return this one year. I asked the IRS myself. Twice.

John (Rin and John) says tax preparation companies have to e-file and gave an explanation of how it works, which I dont understand because I've never gone to H&R Block type places. But if you want to save the cost and do your own taxes, then paper file. I don't even know what it costs at a tax preparation place.

Yes, I tried to explain it simply, but I can't follow things either unless I'm at the computer and have my tax papers in front of me. So most people just say you get to exclude the foreign income which makes you think it doesn't count at all.

i am defenitly going to file married fililing jointly - when i first got my info in turbo tax i had it as married and filing seperately...but when i switched it to jointly it was a 3000 dollar difference.

As far as paper filing, turbo tax should be able to prepare the papers and i just need to print them correct? or do i need to download the forms and enter them as a replica from turbo tax? honostly i only filed with paper one time in my last 8 years when i bought my home and got my first time home owner credit . If i can just have turbo tax populate the data and i can print them instead of e-file then attach the residence statement i'll be happy.

I also tried HR block last year but i didn't like them much - they were punching in numbers to me that i can do on my own with turbo tax lol.

thanks !

[Nich-Nick 3,354]

i am defenitly going to file married fililing jointly - when i first got my info in turbo tax i had it as married and filing seperately...but when i switched it to jointly it was a 3000 dollar difference.

As far as paper filing, turbo tax should be able to prepare the papers and i just need to print them correct? or do i need to download the forms and enter them as a replica from turbo tax? honostly i only filed with paper one time in my last 8 years when i bought my home and got my first time home owner credit . If i can just have turbo tax populate the data and i can print them instead of e-file then attach the residence statement i'll be happy.

I also tried HR block last year but i didn't like them much - they were punching in numbers to me that i can do on my own with turbo tax lol.

thanks !

The print option on Turbo tax has an option to print the documents for filing. Attach w2 to the front. Sign and mail. You can also enter your bank details and get a refund check by direct deposit. I never print "all" or you'll end up with a billion useless duplicates of every place that paid you interest, your W2, worksheets, etc. I print selected things to put away for records also. Then you can save the entire return as a PDF file on your computer.

Lucky you with a refund. We need to wite a check for $4000 so I won't be in a hurry to file.

[Jordandawg05 13]

The print option on Turbo tax has an option to print the documents for filing. Attach w2 to the front. Sign and mail. You can also enter your bank details and get a refund check by direct deposit. I never print "all" or you'll end up with a billion useless duplicates of every place that paid you interest, your W2, worksheets, etc. I print selected things to put away for records also. Then you can save the entire return as a PDF file on your computer.

Lucky you with a refund. We need to wite a check for $4000 so I won't be in a hurry to file.

yeah i will probably do that and get that filed this week ..wify wants $$ to upgrade bedroom hahaha

I had to pay last year as i was taking the wrong deductions on my W4 and it sucked as i was saving for my wedding over seas and cost me 1k that i had to pay the IRS when i needed that !! but luckily this year i get some money back .

Thanks for all your help, i'll keep you updated if i run into any issues.

[Jordandawg05 13]

The print option on Turbo tax has an option to print the documents for filing. Attach w2 to the front. Sign and mail. You can also enter your bank details and get a refund check by direct deposit. I never print "all" or you'll end up with a billion useless duplicates of every place that paid you interest, your W2, worksheets, etc. I print selected things to put away for records also. Then you can save the entire return as a PDF file on your computer.

Lucky you with a refund. We need to wite a check for $4000 so I won't be in a hurry to file.

I am done with the taxes, i was able to make the statement, file the 1040 and the foreign exception as well. I printed them on turbo tax as i mention and will mail tomorrow. i hope it gets processed soon hehe

thanks,