Individual Shared Responsibility Payment and 2016 Taxes

[jamisteven 4]

Hey All! Im wondering if anyone is in the same boat with the Shared Responsibility Payment for the 2016 Tax year. My CPA is telling my me that my wife who arrived at the end of August in 2015, and didnt file for adjustment of status until 2016, not receiving greencard until June of 2016, and who in my eyes would be considered a Dual status Alien for the year of 2016, still owes this penalty. 

Per the IRS website, if she was a dual status alien, she is exempt from this. I am certain that she was in fact a dual-status alien as she was both a nonresident alien and resident alien in the same year, 2016. 

 

If you look at the IRS Website below, in the section "Citizens living abroad and certain noncitizens" 

 

You will see an exemption for:

• A nonresident alien, including (1) a dual-status alien in the first year of U.S. residency and (2) a nonresident alien or dual-status alien who elects to file a joint return with a U.S. spouse; or

https://www.irs.gov/affordable-care-act/individuals-and-families/aca-individual-shared-responsibility-provision-exemptions

 

Has anyone had to deal with this same issue? 

[MariaR323 199]

Sounds like the CPA actually is correct.

 

I'll preface with this: Immigration status should not be confused with status for tax purposes.

 

Your wife, by entering in Aug 2015, is considered a dual-status alien for the tax year 2015. As of 1/1/16, she became a resident for tax purposes for tax year 2016. This is completely different from becoming a legal permanent resident by virtue of receiving the green card in June 2016.

 

Hope this helps shed some light.

 

Maria

[patriot10 11]

CPA is correct.