K1 AOS, Filing Taxes with ITIN?

[ch1212 18]

Hello,

 

My fiancee (now wife) entered the US in December 2020. We've applied for her AOS since, and we're about to file my taxes. We just have a couple hiccups... We're using TurboTax, in case anyone familiar with it knows first-hand what to do here.

 

First, my wife hasn't worked in the US before, and has no SSN or ITN. TurboTax is advising me to file by mail and attach a completed W-7 ITN application for my wife - is this the proper way to handle this SSN/ITN issue?

 

Second, should we file jointly or separately? There is a minimal advantage filing jointly, so there's no financial incentive behind this decision.

 

Thanks!

Edited May 11, 2021 by camhorto

[seekingthetruth 1,246]

48 minutes ago, camhorto said:

Second, should we file jointly or separately? There is a minimal advantage filing jointly, so there's no financial incentive behind this decision.

If she has no income, most married taxpayers benefit a lot by MFJ, so there is a big incentive.  If you are not going to file MFJ, she does not need an ITIN.

 

Search for ITIN.  There are several recent threads.  This one has some good info, especially on page 3.

 

 

[ch1212 18]

16 minutes ago, seekingthetruth said:

If she has no income, most married taxpayers benefit a lot by MFJ, so there is a big incentive.  If you are not going to file MFJ, she does not need an ITIN.

Okay, that's interesting. TurboTax is suggesting that she needs an ITIN application attached with my return, despite we're filing separately.

18 minutes ago, seekingthetruth said:

Search for ITIN.  There are several recent threads.  This one has some good info, especially on page 3.

Thanks for the link. The first post on page 3 is exactly what I've read in other spots, and confirms what TurboTax is suggesting we do. However, if she doesn't need an ITIN, are we able to replace her 999-88-9999 "SSN" with NRA or just crossing it out?

 

Related to other posts in that same topic - we didn't know that my wife is eligible for a SSN through her K1 haha. Her visa has since expired, but since she has a pending AOS will she be able to apply for one before her work permit or green card come?

[seekingthetruth 1,246]

4 minutes ago, camhorto said:

Okay, that's interesting. TurboTax is suggesting that she needs an ITIN application attached with my return, despite we're filing separately.

MFS kind of implies that she would file a return, but she has no income and no reason to file a return, correct? The only reason I got an ITIN for my wife was so that we could file MFJ and we save a bunch of money!  😁

8 minutes ago, camhorto said:

Thanks for the link. The first post on page 3 is exactly what I've read in other spots, and confirms what TurboTax is suggesting we do. However, if she doesn't need an ITIN, are we able to replace her 999-88-9999 "SSN" with NRA or just crossing it out?

She lives in the U.S., correct?  So she is not NRA.  I'm not familiar with MFS and TurboTax, but it seems that crossing out the number only means something if you are going to file a hard copy tax return.

 

17 minutes ago, camhorto said:

Related to other posts in that same topic - we didn't know that my wife is eligible for a SSN through her K1 haha. Her visa has since expired, but since she has a pending AOS will she be able to apply for one before her work permit or green card come?

Yes, I think she could have applied for SSN during the K1 process.  Now she needs the green card to be eligible to get the SSN.  So she currently qualifies to apply for ITIN.

 

I think I read that that 95% of taxpayers use the standard deduction now because they increased the standard deductions and reduced things that can be itemized.   If you file MFS your standard deduction is only 12400.  If you file MFJ, it is 24800.  If you are rich, perhaps MFS is appropriate.  I don't have that problem.  😪

[Wuozopo 4,293]

4 hours ago, camhorto said:

Hello,

 

My fiancee (now wife) entered the US in December 2020. We've applied for her AOS since, and we're about to file my taxes. We just have a couple hiccups... We're using TurboTax, in case anyone familiar with it knows first-hand what to do here.

 

First, my wife hasn't worked in the US before, and has no SSN or ITN. TurboTax is advising me to file by mail and attach a completed W-7 ITN application for my wife - is this the proper way to handle this SSN/ITN issue?

 

Second, should we file jointly or separately? There is a minimal advantage filing jointly, so there's no financial incentive behind this decision.

 

Thanks!

Yes TurboTax is telling your correctly. There is also identification to mail to .Austin, TX along with the return and W7. Usually it is her actual passport. A photocopy can only be sent if you have it certified at an IRS Taxpayer Assistance Center or pay an Acceptance Agent to do it. 
 

Filing jointly, your taxable income gets the advantage of the extra standard deduction for her. Your taxable Income is reduced by $24,800 instead of $12,000. If your income is low and $12000 reduces you to zero taxable income, then the $24,400 doesn’t do anything additional for you. You can’t get lower than zero. 

Edited May 11, 2021 by Wuozopo

[Wuozopo 4,293]

3 hours ago, camhorto said:

However, if she doesn't need an ITIN, are we able to replace her 999-88-9999 "SSN" with NRA or just crossing it out?

On a MFS, just skip that 99-88-999 entry. Leave her SSN field blank. TurboTax can’t efile with blank, 99999, or NRA in SSN field. So you just have to carry on with a blank SSN and ignore their warnings. Fix every field they may point you to in their final check until the only warning is SSN. Then go to the print section and choose print return for filing. Write in NRA in the SSN field that you left blank. Mail the return. TurboTax will give you the address for mailing based on your residence. 

[seekingthetruth 1,246]

5 hours ago, seekingthetruth said:

She lives in the U.S., correct?  So she is not NRA.

Sorry, I was wrong about this as she arrived Dec. 2020.  Wuozopa is correct.

 

2 hours ago, Wuozopo said:

If your income is low and $12000 reduces you to zero taxable income, then the $24,400 doesn’t do anything additional for you. You can’t get lower than zero. 

Yes, didn't think about that angle.  No need for for MFJ and ITIN if that is the case.  However, MFJ does not even have to file if they make less than $24400.  Not sure how that would work for a first time MFJ.