Wrong filing status possible amended return

[DaveO]

A new client came in with a disallowance of EITC letter for 2007 and a balance due for about $1700. She moved here from another state to care for her daughter’s child. She and her husband have claimed the daughter’s child since birth. Daughter earned $2400 for 2007 and filed as single no dependents. Husband filed as single with 1 dependent and received EITC. Client filed as HOH, 1 dependent and also received EITC.

Client and husband are still together only living in different states so she should have filed MFS or MFJ as he should have. If I amend and file as MFJ it would reduce the amount she owes in half. Has anyone done this? Should I attach copies of husband and wife’s individual returns? I can’t tell if she knows the rules and was trying to game the system or just relied on someone else to prepare the return. They are all immigrants from Sudan.

[Koss]

Change to MFJ

It may be worth a shot.

You can change from MFS to MFJ. You just can't change from MFJ to MFS after the due date.

HoH is considered a "separate return." No, it's not the same as MFS. But when someone who is married files HoH, they are filing a "separate return."

In any case, the filing status for at least one of them was invalid. You can't use single if you're legally married, and there are no exceptions to this rule. So amending the return to change the filing status is the appropriate thing to do.

I have worked with the Somali immigrant population, as well as immigrants from Mexico and other Spanish-speaking countries. And what I have found is that there is a pervasive myth that circulates within the immigrant community. Someone told them that it was better to file separately. And they don't understand that MFS is not the same thing as single or HoH.

The other misunderstanding--and this gets a bit more complicated--has to do with the validity of the marriage.

I don't care whether they can produce a copy of their marriage license or not. The question is not whether they have documentation of their marriage. Rather, the question is whether the marriage is recognized by the government of their home country.

Some of these immigrants have marriages performed by a "tribal leader," in some sort of religious ceremony. This type of marriage may or may not be recognized by the government of their home country.

If such a marriage was performed here in the US, by a "tribal leader" or "elder" who is not an ordained minister in the US, then it is not a valid marriage. But if the marriage was performed in their home country, then it may be recognized by the government of their home country. And if it is recognized by the government of their home country, then it is recognized by the government of the USA.

This particular issue may crop up quite a bit with immigrants from Africa, and occasionally with immigrants from Spanish-speaking countries that have a signficant indigenous population, i.e., South American Indian tribes.

But I have found that somehow it has evolved into an urban myth, that circulates even among immigrants from Mexico, who were properly married in the Roman Catholic Church in Mexico. They somehow come to believe that their marriage is not valid, or not recognized, by the US government. And this is simply ridiculous. The US government recognizes marriages that are recognized by any other government of any other sovereign nation. It's in the tax code. I'm not going to search for a citation right now.

But it's still kinda complicated. Because some of these folks may have told immigration officials that they were single when they came into this country. That doesn't change the fact that they are legally married, and under the federal tax law, they can't use the filing status single. But if they do the right thing under the tax code, they might be tacitly admitting that they made false statements to an immigration official.

But a good lawyer can make that issue go away by explaining that there was a language barrier, and that they just didn't get it.

Your job as an accountant is to help them file an accurate tax return. And if they have a valid marriage that is recognized by their country of origin, then they are legally married under the Internal Revenue Code. And that means they can't use the filing status single. So they should amend the return.

You're not an immigration lawyer. So don't try to play that role. Give them the right tax advice. And tell them to consult an immigration lawyer.

:-)

BMK

[DaveO]

Thank you very much for the insights.

As far as I can tell they consider themselves married but have no idea if in fact they legally are or not. If so they both filed wrong. They have filed joint in the past so the IRS has accepted their union for that purpose. They don't share a name but that is not unusual.

And yes, I have seen this among mexican immigrants as well. I always thought they were trying to avoid the whole NR alien filing problem.

Thanks again!

[DaveO]

Koss, you hit the nail on head with your comments. As I have unraveled the rest of the story I wanted to offer the followup.

I did contact the IRS was was instructed to file the amended return through the service center that sent the notice with a request for audit reconsideration.

I told them they would need to amend and prepared the return. Also told them they had to file MFJ or MFS for 2008.

She came in and told me he had filed single again. I told her he had done so with willful disregard for the rules and would likely be banned from the EITC once the IRS sorted it out.

When I figured her taxes as MFS she was disappointed with the refund, took her W-2s and left. Wonder where she went?