Does substantial presence apply?

[Seemoreglass83 18]

Trying to figure out my tax situation and want to verify what a tax accountant told me. My wife moved her dec 26 and we got married on dec 27. Tha accountant told me she doesnt need to file this year since all of her income was when she was out of the country and i can file married filing separately. Is this because of the substantial presence test?

 

Would we have the option to file jointly if we wanted as it seems like we might get a bigger return since she didnt make much in her home country? 

[aaron2020 11,651]

19 minutes ago, Seemoreglass83 said:

Trying to figure out my tax situation and want to verify what a tax accountant told me. My wife moved her dec 26 and we got married on dec 27. Tha accountant told me she doesnt need to file this year since all of her income was when she was out of the country and i can file married filing separately. Is this because of the substantial presence test?

 

Would we have the option to file jointly if we wanted as it seems like we might get a bigger return since she didnt make much in her home country? 

It's unbelievable that a qualified accountant would advise filing separately if her income is low.

 

Who did you go to?  H&R?  

Under the Substantial Presence Test, she is not required to file a 2021 US tax return.  She can volunteer to be treated as a US tax resident for 2021 and file a joint return with you.  She'll need an SSN or ITIN.  Alternatively, you can file separately without her income.  

 

You need to run the numbers for both scenarios.  

What's your income and what's her income for 2021?

Edited February 24, 2022 by aaron2020

[Wuozopo 4,293]

26 minutes ago, Seemoreglass83 said:

Trying to figure out my tax situation and want to verify what a tax accountant told me. My wife moved her dec 26 and we got married on dec 27. Tha accountant told me she doesnt need to file this year since all of her income was when she was out of the country and i can file married filing separately. Is this because of the substantial presence test?

 

Would we have the option to file jointly if we wanted as it seems like we might get a bigger return since she didnt make much in her home country? 

 One option is what he told you. She is not obligated to file for 2021.

Your other option is file a joint return because she married a US citizen in 2021. Because she does not have physical presence in the US, nor a greencard, you have to both sign a statement electing for her to be treated as a resident alien for tax purposes. (see Publication 519). That’s a perk allowed spouses of USCs by the IRS. 
 

To file jointly she must have a SSN or ITIN. If she hasn’t been in to get her SSN, she only has about 2 weeks of eligibility left as a K1. Then the window closes for a SSN until she gets an EAD or greencard approval. An ITIN is a bit cumbersome but doable. If you will make a timeline on Visa Journey I can help you further with that if she doesn’t have a SSN. 

Edited February 24, 2022 by Wuozopo

[Seemoreglass83 18]

5 minutes ago, aaron2020 said:

It's unbelievable that a qualified accountant would advise filing separately if her income is low.

 

Who did you go to?  H&R?  

Under the Substantial Presence Test, she is not required to file a 2021 US tax return.  She can volunteer to be treated as a US tax resident for 2021 and file a joint return with you.  She'll need an SSN or ITIN.  Alternatively, you can file separately without her income.  

 

You need to run the numbers for both scenarios.  

What's your income and what's her income for 2021?

Wasnt h and r. It was a cpa I found through Yelp. I'm having a heck of a time finding someone who seems like they understand our situation. A different one quoted me $900 to file but said he wasnt sure if their firm could do it since she doesnt have a ssn or itin.

 

My income was around 83k and hers was 9k so I'm pretty sure it makes sense for us to file jointly but I'm not confident doing it by myself since she doesnt have hr ssn yet. Will I need to apply for an itin for her if i file separately? Does she still need to file if I file separately?

[Seemoreglass83 18]

5 minutes ago, Wuozopo said:

 One option is what he told you. She is not obligated to file for 2021.

Your other option is file a joint return because she married a US citizen in 2021. Because she does not have physical presence in the US, nor a greencard, you have to both sign a statement electing for her to be treated as a resident alien for tax purposes. (see Publication 519). That’s a perk allowed spouses of USCs by the IRS. 
 

To file jointly she must have a SSN or ITIN. If she hasn’t been in to get her SSN, she only has about 2 weeks of eligibility left as a K1. Then the window closes for a SSN until she gets an EAD or greencard approval. An ITIN is a bit cumbersome but doable. If you will make a timeline on Visa Journey I can help you further with that if she doesn’t have a SSN. 

She doesnt have a ssn. We just got our noa1 back for her ead application in which we checked for her to apply for a ssn along with her application.

 

I will work on completing my timeline.

[aaron2020 11,651]

You're better off filing jointly.

A CPA wasn't sure if the firm could file since she doesn't have an SSN or ITIN.  Oh brother.  It's pretty simple for a real accountant to file an ITIN with a mailed in tax return.

You can file separately now.  She does not need to file since she has no obligations to file a 2021 tax return.  Once she gets an SSN, you can amend the return to file jointly.  

Edited February 24, 2022 by aaron2020

[Coin3 66]

I recommend trying to get your wife a SSN now rather than later. If she can get her SSN before you file your tax returns, and you elect to have her considered as a US resident for tax purposes, then she will be eligible to receive $1400 from the 2021 Recovery Rebate Credit. I did the same for my wife and we received our refund just a couple days ago.

 

For reference:

https://www.irs.gov/pub/newsroom/fs-2022-12.pdf

https://www.irs.gov/individuals/international-taxpayers/nonresident-spouse

 

I definitely also recommend filing jointly, as you will receive twice the standard deduction, and most taxes resulting from her worldwide income can be excluded using Form 2555.

Edited February 24, 2022 by Coin3
References added

[Coin3 66]

Regarding finding someone to help you file everything correctly, I had a good experience with H&R Block, where you can pay to have a Tax Pro review your information and attach documents when e-filing (such as the statement to have your wife be treated as a US resident). You can also work with one of their Tax Pros directly and have them put everything together for you. They have lists of their Tax Pros on their website, and what they specialize in, so you should be able to find someone who can handle your situation.

[Seemoreglass83 18]

40 minutes ago, aaron2020 said:

You're better off filing jointly.

A CPA wasn't sure if the firm could file since she doesn't have an SSN or ITIN.  Oh brother.  It's pretty simple for a real accountant to file an ITIN with a mailed in tax return.

You can file separately now.  She does not need to file since she has no obligations to file a 2021 tax return.  Once she gets an SSN, you can amend the return to file jointly.  

Ah ok, I would need to file by mail since she doesnt have ssn, correct?

[Wuozopo 4,293]

18 minutes ago, Seemoreglass83 said:

She doesnt have a ssn. We just got our noa1 back for her ead application in which we checked for her to apply for a ssn along with her application.

 

I will work on completing my timeline.

You might try to get an appointment with a Social Security office which would make things much easier. She has 90 days eligibility as a K1, but they won’t do it in the last 2 weeks, so 76 days in the country is the cut-off day to apply. Offices are limited with appointment only since covid. Some have said using the reason “she needs it for tax filing” has gotten them an appointment. You can go to any SSA office, so try several in an attempt to get an appointment before her 76th day.. I go to a rural office and get much better service than in the big city.
 

If she files with a SSN, she will also qualify for the third stimulus payment of $1400 like you probably received around March of 2021. Not so filing with an ITIN or doing an amended return. But those will still get you the better tax rate and the extra standard deduction ($12,550) to reduce your taxable income.. The timing of the receipt of a SSN is important. She must have a SSN by filing deadline April 18 (or by Oct 15 if you apply for a tax filing extension) to get the extra $1400. 
 

There are so many directions you may go, so won’t detail each process until you see if it’s possible to get a Social Security appointment in the next two weeks. Try that first.

[Seemoreglass83 18]

1 minute ago, Wuozopo said:

You might try to get an appointment with a Social Security office which would make things much easier. She has 90 days eligibility as a K1, but they won’t do it in the last 2 weeks, so 76 days in the country is the cut-off day to apply. Offices are limited with appointment only since covid. Some have said using the reason “she needs it for tax filing” has gotten them an appointment. You can go to any SSA office, so try several in an attempt to get an appointment before her 76th day.. I go to a rural office and get much better service than in the big city.
 

If she files with a SSN, she will also qualify for the third stimulus payment of $1400 like you probably received around March of 2021. Not so filing with an ITIN or doing an amended return. But those will still get you the better tax rate and the extra standard deduction ($12,550) to reduce your taxable income.. The timing of the receipt of a SSN is important. She must have a SSN by filing deadline April 18 (or by Oct 15 if you apply for a tax filing extension) to get the extra $1400. 
 

There are so many directions you may go, so won’t detail each process until you see if it’s possible to get a Social Security appointment in the next two weeks. Try that first.

Ah ok, it doesnt matter that we already applied with her ead application? They'll just ignore the application when it arrives from uscis? Just imagining a scenario in which we get a ssn now and the application arrives later asking for a ssn.

[JeanneAdil 6,510]

54 minutes ago, Coin3 said:

I recommend trying to get your wife a SSN now rather than later. If she can get her SSN before you file your tax returns, and you elect to have her considered as a US resident for tax purposes, then she will be eligible to receive $1400 from the 2021 Recovery Rebate Credit. I did the same for my wife and we received our refund just a couple days ago.

 

For reference:

https://www.irs.gov/pub/newsroom/fs-2022-12.pdf

https://www.irs.gov/individuals/international-taxpayers/nonresident-spouse

 

I definitely also recommend filing jointly, as you will receive twice the standard deduction, and most taxes resulting from her worldwide income can be excluded using Form 2555.

https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z

 

Columbia does not have tax treaty with the US 

[Coin3 66]

19 minutes ago, JeanneAdil said:

https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z

 

Columbia does not have tax treaty with the US 

I assume you are referring to the requirements for form 2555 to exclude foreign-earned income. In their case, they should still qualify by physical presence as long as his wife was in Columbia for at least 330 days of 12 consecutive months ending in 2021.

 

See Figure 4-A on Publication 54:

https://www.irs.gov/pub/irs-pdf/p54.pdf

[Coin3 66]

52 minutes ago, Seemoreglass83 said:

Ah ok, it doesnt matter that we already applied with her ead application? They'll just ignore the application when it arrives from uscis? Just imagining a scenario in which we get a ssn now and the application arrives later asking for a ssn.

From what I have read here on VJ, there is no issue with applying through the EAD application even if you already have an SSN or have applied for one yourself. They will either ignore the request, or issue a new SS card that no longer states "VALID FOR EMPLOYMENT ONLY WITH DHS AUTHORIZATION." At least that's what I'm hoping they do when my wife's EAD is processed.

[Ayrton 965]

59 minutes ago, JeanneAdil said:

https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z

 

Columbia does not have tax treaty with the US 

You keep posting here in the forum that immigrants can't use form 2555 to exclude their foreign income because their home country doesn't have a tax treaty with the US. 

 

Your comment is wrong, you don't need to have a tax treaty. For 99% of the immigrants here, in their first year they meet the physical presence test and are eligible to use form 2555.

 

Please, stop spreading misinformation.