Foreign Wages

[S T]

I have a t/p working abroad, which for several years we have filed his W-2 and claimed the foreign income exclusion.

New wrinkle! T/p is still working abroad and qualifies for foreign income exclusion, is a US Citizen, but he married a Phillipine Citizen in 2008, as of this date, has not received any US papers for the new spouse.

How does this affect the t/p filing for 2008? I am trying to find out if she has any income, I know she doesn't have any US ID#.

Sandy

[Koss]

Filing Status

Well, he's no longer single...

So for 2008, he'll have to use MFS or MFJ.

This can get really complicated really fast. But if you take a step back and take a deep breath, it usually isn't as bad as it seems.

She's a nonresident alien married to a US citizen. That gives her several options. For tax purposes, she can be a true nonresident alien, or she can be a dual-status alien, or she can choose to be treated as a resident alien for the entire year.

If I were you, or if I were your client, I wouldn't screw around with dual-status.

If she has meaningful income in the Philippines, and no US income, and her foreign income has no connection to the US, then she could just stay off the radar, with no requirement to even file a return. That means he'll have to file MFS.

If she has no significant income, and the long-term plan is for her to immigrate to the USA and become a permanent resident, then they should file a joint return, and she can make the election to be treated as a resident alien for tax purposes for the entire year. That won't stop him from claiming the foreign earned income exclusion. To go this route, she'll need to apply for an ITIN.

Regardless of how you do it, you can forget about electronic filing for this year. If she chooses not to file a return, and he files MFS, you'll need to leave the spouse's SSN field blank, or write in "NRA." If they file MFJ, you'll need to write in "applied for," and file the tax return together with her Form W-7 (ITIN application). Without an SSN or ITIN for her, the return will have to be filed by mail.

The only other option is to file an extension, if they think she'll be eligible to get an SSN by the October due date. But if they haven't started any immigration paperwork, that's probably not gonna happen that fast...

Good luck.

BMK

[S T]

Foreign

Thanks Burton, Your insight really assisted.

More info, new wife is Philllipine Citizen working for airlines and will be taxed in Bahrain and Phillipines. Marriage is confirmed as of 8/08, not employed after that date.

Taxpayer has not started any immigration papers.

So this taxpayer will file MFS and use the foreign income exclusion as we have in the past, and noting NRA on the return, paper file.

PS I made another post on another US citizen and foreign, it was posted under another title so you probably didn't see it. So maybe your insight on that will also assit me.

I am so glad you are a poster on this Board!!

Sandy