Got my wife to the USA...how to declare on taxes?

[allanr 4]

Just moved to the USA yesterday and thinking about next year's taxes.  I've read a fair share about this.  What I've read said  that as long as my  wife has a SS#, we have  the option of married filing jointly status,  which would be advantageous was a tax standpoint.  The problem we have is when my wife tried to get an 2019 income statement from the very large on-line English tutoring company  she was told that since all the employees of the company were "free agents", they do not supply annual earnings statements.  Argument got us nowhere.

 

Her earnings only amounted to about $4,000.

 

Since I greatly prefer to pay taxes, but can't get the tax documents, I'm thinking about putting in a representative number on the form without exact documentation and paying taxes on it.  I'm wondering if  doing so might create additional problems however.

 

The other option is that since evidently this income number is reported nowhere and therefore won't be flagged,  I could just not include it, something that I would not be entirely  comfortable doing  as well.

 

Anyone have any  advice on this?

[Mylilelar1 8]

14 minutes ago, allanr said:

Just moved to the USA yesterday and thinking about next year's taxes.  I've read a fair share about this.  What I've read said  that as long as my  wife has a SS#, we have  the option of married filing jointly status,  which would be advantageous was a tax standpoint.  The problem we have is when my wife tried to get an 2019 income statement from the very large on-line English tutoring company  she was told that since all the employees of the company were "free agents", they do not supply annual earnings statements.  Argument got us nowhere.

 

Her earnings only amounted to about $4,000.

 

Since I greatly prefer to pay taxes, but can't get the tax documents, I'm thinking about putting in a representative number on the form without exact documentation and paying taxes on it.  I'm wondering if  doing so might create additional problems however.

 

The other option is that since evidently this income number is reported nowhere and therefore won't be flagged,  I could just not include it, something that I would not be entirely  comfortable doing  as well.

 

Anyone have any  advice on this?

That sounds highly illegal. Doesn't every employer have to supply some sort of earnings statement? MMmm.....makes me wonder if said emp!oyer is skirting some kind of federal obligation. LIKE TAXEs.Your wife's employer is taking $$ in but PERHAPS not reporting business income to the feds.  Even real estate agents who are independent contractors have to pay both sides of SS and federal taxes as do all business people.

Your wife is basically being paid under the table.Your wife has a SS # you say.....did her employer take out SS?

[Ontarkie 14,221]

~~Moved to Taxes and Finances, from Bringing Family of USC - the topic is taxes.~~

[aaron2020 11,651]

Declare the income as other income on your tax return.  It's that simple.  

 

 

[aaron2020 11,651]

4 hours ago, Mylilelar1 said:

That sounds highly illegal. Doesn't every employer have to supply some sort of earnings statement? MMmm.....makes me wonder if said emp!oyer is skirting some kind of federal obligation. LIKE TAXEs.Your wife's employer is taking $$ in but PERHAPS not reporting business income to the feds.  Even real estate agents who are independent contractors have to pay both sides of SS and federal taxes as do all business people.

Your wife is basically being paid under the table.Your wife has a SS # you say.....did her employer take out SS?

They just moved to the US yesterday.  It's a foreign employer; not a US employer.  So there is no skirting of federal obligation since it's not a US company.  

You are completely misunderstanding the situation.  

[allanr 4]

5 hours ago, Mylilelar1 said:

That sounds highly illegal. Doesn't every employer have to supply some sort of earnings statement? MMmm.....makes me wonder if said emp!oyer is skirting some kind of federal obligation. LIKE TAXEs.Your wife's employer is taking $$ in but PERHAPS not reporting business income to the feds.  Even real estate agents who are independent contractors have to pay both sides of SS and federal taxes as do all business people.

Your wife is basically being paid under the table.Your wife has a SS # you say.....did her employer take out SS?

This happened while my wife was in the Philippines, so no SS  was involved.  I do have to  declare her income  now that we're in the USA and  due to the fact I'll file married, filing jointly.  The company is 51Talk, very big company on the NYSE.    They employ thousands of english  teachers.  Why they do things the way they do is  a  mystery...they just told my wife that since she is an  independent contractor they don't have to give her an annual itemization of her earnings.  I'll just declare the income the best I can...she does have monthly sheets showing her working hours that I made  her save before quitting.  The grand total of taxes she'll owe is only $400.

 

 

[Tesco 70]

I'd assume that your spouse qualified for the substantial presence test and was a resident of the a foreign country for 330 days, Simply file a 2555 for 2019, which will exclude all of the earned income that you state. It's the simplest method and you have zero tax paid calculations to concern yourself with. You will of course need to substantiate the earnings and prove the income source. Assuming this is the only foreign sourced income, general or passive, filing as married filing jointly will be the best option. In effect you will receive a $24k tax allowance on a single income

[geowrian 22,337]

How was she paid? Check? Direct deposit? If so, you can just look at the bank account and see how much she earned that year and report it. Keep that documentation (i.e. bank statements) in case you ever get audited, but no statement is required at the time of filing.

And as noted, you should be able to exclude the income afterwards via the FEIE.

Check with a CPA if you are still uncertain.

[Nitas_man 3,100]

On 11/21/2019 at 9:39 AM, allanr said:

Just moved to the USA yesterday and thinking about next year's taxes.  I've read a fair share about this.  What I've read said  that as long as my  wife has a SS#, we have  the option of married filing jointly status,  which would be advantageous was a tax standpoint.  The problem we have is when my wife tried to get an 2019 income statement from the very large on-line English tutoring company  she was told that since all the employees of the company were "free agents", they do not supply annual earnings statements.  Argument got us nowhere.

 

Her earnings only amounted to about $4,000.

 

Since I greatly prefer to pay taxes, but can't get the tax documents, I'm thinking about putting in a representative number on the form without exact documentation and paying taxes on it.  I'm wondering if  doing so might create additional problems however.

 

The other option is that since evidently this income number is reported nowhere and therefore won't be flagged,  I could just not include it, something that I would not be entirely  comfortable doing  as well.

 

Anyone have any  advice on this?

She won’t owe anything.

 

Gather everything she has, add it up, convert it into USD.  Whatever’s missing annualize it or use whatever you have documentation for.  It won’t matter.

 

Then check that you want her treated as resident for income tax purposes.

It’s foreign income and excludable.

 

File the foreign earned income exclusion under status “bonafide resident” of her former country, not the physical presence test.   

She can then exclude a fraction of $109,000 as foreign earned income.  The fraction is number of days this year out of the US / 364 total days of the year.  Almost $100k
 

Turbotax will calculate it for you.  It’s very straightforward.  It isn’t enough to create any issue for you.

 

I’m assuming she was a bonafide resident for at least a full year in the Phillipines before she moved to the US.

 

Edited November 27, 2019 by Nitas_man