Hi,
I was married in March of 2011, my spouse will likely not finish the CR-1 visa process until 2012. His income in his country is not high enough to be eligible for income taxes in his country. Mine is substancially higher, and I have filed every year since I was 10 or so. We have no dependents. I bought a house in 2009 so my only deductions other than the standard have been related to mortage interest, town real estate taxes, etc...

I have a few questions:
1) Do I now need to file as married as we are legally married and have started the immigration process for him to be come a permanent resident?
2) Should I be thinking about adjusting my withholding? I am currently claiming 0 exemptions and withholding at my old single rate, as I had no idea whether he'd be included or not and really didn't want to owe taxes for 2011.
3) Would his foreign income need to be reported on my tax return? If so, what documentation is required? He may not get much documentation since he is exempt in his country.

I know that is a lot to digest and probably tricky without details, if his country matters it is Jamaica. I am not sure who to ask while the immigration process is ongoing, he has not been approved for conditional permanent residence yet and that process is not likely to be completed this year.

I am gratefull for this forum and any assistance or commentary you have to point me in the right direction.

Thanks and Best Regards,
KReneeS

“1) Do I now need to file as married as we are legally married and have started the immigration process for him to be come a permanent resident?”--->Correct; as you said, you were married in March of 2011, so, you need to file your US returns as either MFJ or MFS; a joint return generally cannot be filed if either spouse is a nonresident alien at any time during the tax year. However, if one spouse was a nonresident alien or dual-status alien who was married to a U.S. citizen or resident alien at the end of the year, the spouses can choose to file a joint return. I mean when married to a foreign spouse, you must either file under married filing jointly or married filing separately. If filing jointly, it is important to also determine the amount of your own and your spouse's foreign income (if any because both you and your spouse are subject to both US source and world wide income to the IRS), as well as your own and your spouse's U.S. income (if any). As your foreign spouse doesn't have any U.S. source income, he is not required to pay taxes to the IRS. In such case, you may choose the married filing separately for your own tax return on your US source income to IRS. However, as you can see, filing separately has higher tax rates( after single status) and fewer benefits (you won't be able to claim the elderly and disabled tax credit, child and dependent care tax credit and earned income tax credit, among other deductions and credits. If you and your spouse decide to file jointly, you have to declare your worldwide income (including exemptions, deductions and credits) as a couple in your U.S. return. Your non-resident alien spouse will then be treated as a resident alien for tax purposes only. Joint filing assumes you elect to be taxed on all your worldwide income( if you have) and supply all pertinent and necessary documentation of tax liability.
“2) Should I be thinking about adjusting my withholding?”-I guess it depends on the situation; if you file your return as MFS, then since filing as MFS usually results in higher tax as said above, the safe money bet here is to file your W-4 as Single + 0 allowances as you did. It's perfectly legal to file a W-4 as Single regardless of your actual marital status as it's only used to calculate withholding. Please vist the IRS Website here an dfollow the instructions there; 2011 Withholding Calculator
“ I am currently claiming 0 exemptions and withholding at my old single rate, as I had no idea whether he'd be included or not and really didn't want to owe taxes for 2011.”--->As said above.
“3) Would his foreign income need to be reported on my tax return?”--->As said above, it depends; if you file your return as MFJ, then yes. If NOT, no.
“ If so, what documentation is required? He may not get much documentation since he is exempt in his country.”--->I guess you need a copy of his foreign paychecks, paystub or etc. AS you said, he is NOT subject to income tax to the foreign taxing authority(ies), So, both you can’t file Form 1116; as you can’t claim any foreign tax credit on your US return to the IRS. Even if your spouse does not get a reporting statement such as a W-2. If he is an employee, report the amount that he received on Line 7 of Form 1040 for wages. If he is self-employed, report his earnings on Schedule C. If he is self-employed, he'll also need to pay self-employment tax on Schedule SE. If he an employee, self-employment tax does not apply to his wages.
“ I am not sure who to ask while the immigration process is ongoing, he has not been approved for conditional permanent residence yet and that process is not likely to be completed this year.”---->I guess but NOT sure, you/ your spouse may contact US embassy in Jamaica or etc. You, as an U.S. Citizen or resident, can file joint return as a resident even when the spouse is foreign alien and has never been to the U.S. As you rspouse has no SSN, he needs an ITIN( W7 is needed to be filed for an ITIN) for US tax retun as a spouse of a U.S. citizen/resident alien. IRS issues ITINs to foreign nationals and others who have federal tax reporting or filing requirements and do not qualify for SSNs. A non-resident alien individual not eligible for an SSN, who is required to file a U.S. tax return only to claim a refund of tax under the provisions of a U.S. tax treaty, needs an ITIN. However, if your spouse has, or is eligible to get a U.S. SSN, he doesn’t need to submit the form W7.

Thank you for such a thorough and detailed response, and so quickly.

I didn't think he was eligible for a SSN till his conditional resident visa was approved. The USCIS process has been approved but the visa process has only just begun, so I would be surprised if his interview and visa were done before the end of the year. If he gets here I will file jointly. If not, we'll have to figure out which makes the most sense. If he gets an ITIN for this year, can he use his SSN going forward when he has one, like - next year?

I have no income in Jamaica, only in the US, I am a US citizen. He only has income in Jamaica, none in the US. My taxable income if I was filing as single would probably end up around 85k after deductions, and before adding in his income. Right now all our finances are tied up in the house, moving him here, and the immigration process, so avoiding a bill in the spring is paramount. It sounds like withholding at my single rate with 0 allowances is the safest option for now.

Thanks again for all your help.

“ If he gets here I will file jointly. If not, we'll have to figure out which makes the most sense. If he gets an ITIN for this year, can he use his SSN going forward when he has one, like - next year? “---->Correct. He can use his SSN next year. ITINs are just for federal tax reporting only, and are not intended to serve any other purpose.
I have no income in Jamaica, only in the US, I am a US citizen. He only has income in Jamaica, none in the US. My taxable income if I was filing as single would probably end up around 85k after deductions, and before adding in his income.”---> As said previously, as you are married, you can’t file your return as Single; your filing status is NOT single. UNLESS you are unmarried or considered unmarried on the last day of the year, you can’t file your return as single. Since you have no any income in Jamaica, you are subject to only your US source income on your return.
“ Right now all our finances are tied up in the house, moving him here, and the immigration process, so avoiding a bill in the spring is paramount. It sounds like withholding at my single rate with 0 allowances is the safest option for now.”--->As long as you file your return as MFS. I fyou fle your return as MFJ, then you need to adjust your withholding allowances on your W4. Good luck~~