First Year Tax Questions - MFS

[FruitSpikeAndMoon 0]

Background:

I'm a US Citizen who married my Canadian spouse in December. He entered the US on a K-1 in December 2015, and does not meet the substantial presence test for 2015 (spent 330+ days in Canada). We filed the AoS at the beginning of January 2016, he received a SSN in January 2016, and he received his Green Card with interview waived in March 2016.

My spouse had a Canadian TFSA which he closed before the end of 2015, and when looked at the nightmare that would be figuring out how to report that correctly for MFJ, we figured we'd be better off filing MFS over potentially getting it wrong.

All of my spouse's 2015 income is Canadian-sourced. I (we) live in a community property state (Texas); the only income I constructively received in 2015 after we got married (2 weeks before the end of the year) was 7 cents interest on a bank account still only in my name.

Questions:

1. Sanity check: the green card test is tied to the calendar year for the taxes in question (2015), right? The fact that he received his green card now in 2016 before we filed our return doesn't stop him from being a nonresident alien for 2015? We're not causing any complications down the line by filing separately with him treated as a nonresident alien spouse for 2015?

2. I think I'm required to file form 8958 because I'm a resident of a community property state, but just allocate everything to myself because community property rules are mostly disregarded for nonresident alien spouses and I didn't have any income that would be split after we got married. Is this correct?

3. Since my spouse has no US source income, he doesn't have to file any US form at all and all I have to send in to the IRS is my own MFS return, correct?

4. Assuming 3 is correct, I can claim the exemption for my spouse since he has no US source income and isn't filing a return, correct?

I appreciate any answers - I think I've got this figured out but I want to make sure that I'm not making an egregious mistake here that will haunt us later. Thanks in advance.

Edited April 5, 2016 by FruitSpikeAndMoon

[Nich-Nick 3,354]

Questions:

1. Sanity check: the green card test is tied to the calendar year for the taxes in question (2015), right? The fact that he received his green card now in 2016 before we filed our return doesn't stop him from being a nonresident alien for 2015? We're not causing any complications down the line by filing separately with him treated as a nonresident alien spouse for 2015?

He was a nonresident alien for tax purposes in calendar year 2015.

2. I think I'm required to file form 8958 because I'm a resident of a community property state, but just allocate everything to myself because community property rules are mostly disregarded for nonresident alien spouses and I didn't have any income that would be split after we got married. Is this correct?

I am not that familiar with all that community property stuff. I read it all once eight years ago and don't want to read it again. (I am also from Texas) Yes I think you would do the form, but quite frankly for 7 cents I would tend to skip it myself. If they call you on it (which will never happen) I would say oops sorry. You are Claiming it as income, which is what counts. And the IRS rounds down and disregards cents so it's zero, right?

3. Since my spouse has no US source income, he doesn't have to file any US form at all and all I have to send in to the IRS is my own MFS return, correct?

Correct

4. Assuming 3 is correct, I can claim the exemption for my spouse since he has no US source income and isn't filing a return, correct?

That's what I would do.

Edited April 5, 2016 by Nich-Nick