“ I realize today that above a certain income, although living overseas, I would still be obligated to file for tax returns and in some cases also pay US taxes. “---->In geenral,
correct; you even need to file US return(s), both federal and state returns, to claim your refund(s) as long as you are subject to it/ or to claim yur foreign tax credit on taxes that you paid to the foreign taxing authority(ies) on your federal and state return, or etc. As a US citizen, you are subject to UYS taxes on your US source and world wide income(your foreign source income; EARNED INCOMEA DN UNEARNED INCOME).
I believe that my income did not exceed the minimum to owe tax in the US, but might have exceeded the minimum required to file taxes in the US (regardless of paying taxes abroad).”---->Thenas described above, you, to claim your foreign tax(es) credit(s) could file your US tax returns.
In 2007, while still living overseas, I got married. My wife is not a US citizen, nor does she have any sort of immigrant status in the US.Last year my wife was accepted to a one-year academic program in New York. We moved to New York in August 2011. My wife entered on an F-1 student visa.In the meantime, I've found full-time work here in New York and we have made the decision to stay in the US (I only started getting US based income in year 2012). We're now preparing to file for my wife's adjustment of status and green card.
“Part of the filing for her green card requires that I submit tax return forms for the past three years. This is when I realized that as a US citizen I was supposed to report income and possibly pay taxes for those years I was living abroad, so I'm now trying to get this all in order. But my first priority is to get the proper documents for the past three years, since my wife's school year is over and we don't have much time to get the adjustment of status and immigration visa process going.”----->Correct
So here are my questions:
“1. It is my understanding that I need to file form 1040 for each of the years I had income above a certain amount and also a form 2555-ez for foreign earned income exclusion. Are those the only forms I need to submit?”---->Unless you itemized your deductions on Sch A of 1040 , you may file Form 1040A/1040EZ and your home state return(currently nine states do not impose income taxes to their residents in US);to claim your foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction, you must have foreign earned income, your tax home must be in a foreign country, and you must be A U.S. citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year; a U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year, or a U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months. You may claim the Foreign Tax Credit for taxes paid in a foreign country. However, you may not claim a tax credit for taxes paid on any income which has been excluded from US taxation using the foreign earned income exclusion or the foreign housing exclusion. You may claim a tax credit or an itemized deduction for taxes paid to foreign countries. You do not need to live or to work in that foreign country in order to claim this benefit. There are no time requirements like there are for the income exclusions. You can claim either the FEIE or the tax credit, but not both, for all foreign taxes paid UNLESS your FEIE amount exceeds the FEIE credit. You need to file form 1116 to claim your foreign tax credit on your US return(s0 by reporting it on 1040 line 47 or on Sch A of 1040 line 8 as other taxes, Iguess.
Please visit the IRS Website here:
Foreign Earned Income Exclusion - Can I Claim the Exclusion or Deduction? What Foreign Taxes Qualify For The Foreign Tax Credit?
I tried asking my local IRS office and even went over there to speak with someone in person, but it was very difficult to get straight answer. “----> not blames you; I guess you may need to talk an international taxation representative at the IRS. Not many IRS (even) agents are familiar with international taxation.
“It was like they were being ultra cautious about not giving any advice (which I can somehow understand, but I'm not looking for the best "accountant-type" advice, I'm just looking for a basic correct answer).”------>ot blame them; they do not want to misadvise you;
“2. As far as status, I understand it's either "married filing separately" of "married filing jointly".----->neral correct as you are married your filing staus is either MFJ or MFS; when married to a foreign spouse, you must either file under MFJ/MFS. If filing jointly, it is important to also determine the amount of your own and your spouse's foreign income (if any), as well as your own and your spouse's U.S. income (if any; for example as a F1visa holder, your spouse may have income fromOPT/CPT work). If your foreign spouse doesn't have any U.S. income, they are not required to pay taxes to the IRS In such case, choose the marriage filing separately for your own tax return. As said previously, taxes on foreign income that you or your spouse already paid in another country may be eligible for claiming of the foreign tax credit on Form 1116 or you may use the foreign earned income inclusion on Form 2555. The US has tax treaties with most countries, meaning you will more likely get credit for foreign income taxes already paid in other countries. You will also get the usual standard deductions and exemption deductions based on your filing status.
I'm not sure which is the one I should be choosing, since my wife is not a citizen and is not even permitted to work in the US. I think she is what is termed a non-resident alien”--->doesn’t matter if your spouse has no SSn# yet; you can (need to)choose one of them.You need to weigh your options whether you choose to file one joint return , you want to file separate returns , MFS, or you will only file a separate return for yourself as a U.S. citizen or permanent resident. Then UNLESS your spouse has US source income, she doesn’t need to file her US return. Filing separately has higher tax rates 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). Yet, filing separately generally releases you from the burden of any issues or lies made by your spouse in their own tax return.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 and supply all pertinent and necessary documentation of tax liability. You and your spouse must sign the return for it to be officially considered as a joint return.
“3. From a different post on this forum by someone is somewhat similar circumstances - I also learned that possibly my wife is supposed to file for tax return as well. And that she should apply for some sort of tax ID number...?”------>It dependsscribed above. UNLESS your spouse has US source income, she is NOT required to pay her taxes to the IRS, OK??? In such case, you can choose the marriage filing separately for your own tax return. As long as you and your spouse fiel your return as MFJ, then you can get your foreign spouse either a SSN# or an ITIN. While it is not necessary for a foreign spouse without any U.S. income to file at the IRS, you, as a U.S. citizen filing your return, can only claim her exemption if she has an ITIN. You can claim exemptions for your foreign spouse only if she had no gross income, is not filing a U.S. return or was a dependent of another taxpayer. This applies to cases where the spouses are both U.S. citizens or permanent residents or if either of the couple is a non-resident alien , in this case, yur spouse as a foreign citizen.
“4. In addition to question 3 above, I also read on the IRS website that my wife, although considered a foreign student (F-1 status), possibly needs to report the scholarship which she was awarded by the academic institution which she attended in NY. Is this true?”---->Yes it is true; as long as she files her return as MFS, then she needs to file 1040NR/1040NR-EZ with firm 8443; even if she was in the U.S. even 1 day in 2012, your spouse, as a F1visa holder UNLESS she files her return as MFJ, must file Form 8843.If she files her return as MFJ as a US resident, then, she doesn’t need to report her scholarship on the joint return as taxable income as long as the schoarlshp scholarship is tax-free if: sbheis a full-time or part-time candidate for a degree at a primary, secondary or accredited post-secondary institution;the award covers tuition and fees to enroll in or attend an educational institution;the award covers fees, books, supplies and equipment required for your courses,OK???
“5. Last question... as mentioned above, for the filing of my wife's green card, I am required to submit a transcript of my federal tax return of the previous year. How should I go about obtaining this transcript as quickly as possible?”---->As long as you filed your US returns with the IRS before, then, For many purposes, you can meet the requirements for past tax returns with a transcript, a computer print-out of the information on your old tax return, rather than an exact copy. A transcript may be an acceptable substitute for an exact copy of a return by the US Citizenship and Immigration Services and lending agencies for student loans and mortgages. A tax return transcript will show most line items contained on the return as it was originally filed. If you need a statement of your tax account which shows changes that you or the IRS made after the original return was filed, however, you must request a "tax account transcript". Both transcripts are generally available for the current and past three years and are provided free of charge. The period in which you will receive the transcript varies from within ten to thirty business days from the time the IRS receives your request for the tax return or tax account transcript.You can obtain a free transcript by calling the IRS at toll-free 800-829-1040 and following the prompts in the recorded message.ALSO,you can get an exact copy of a previously filed and processed U.S. income tax return and all attachments (including Form W-2), by completing IRS Form 4506 , Request for Copy of Tax Return, and mailing it to the address listed in the instructions, along with a payment of $57.00 for each tax year requested.
Please visit the IRS Website here:
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