Author Topic: Back-filing taxes and question on state tax returns  (Read 493 times)

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Offline Aless

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Back-filing taxes and question on state tax returns
« on: March 04, 2017, 05:42:59 PM »
Hi guys. I've been, for lack of better word, naughty, and not filed US taxes for 9 years. We're now thinking of repatriating so it's time to get my 'house' in order. From everywhere I've read, I need to file 3 years of taxes for re-establishing domicile for my spouse's green card application. Is there any reason to file back further? I have almost zero documents going back that far, so at best it any filings would be a ballpark estimation.

Also, I have never understood state tax returns. My last "residence" was in a state tax return state (Virginia), so do I need to keep filing there when I do the 2014, 2015 and 2016 returns? I have no address or family member there anymore and I haven't even registered to vote in 4+ years.

Thanks!!

edit: to clarify, I have never had assets over $10k at any given time, so don't believe FBAR is an issue.
« Last Edit: March 04, 2017, 05:51:49 PM by Aless »
BUNAC: 9/2004 - 12/2004. Student visa: 1/2005 - 7/2005. Student visa #2: 9/2006 - 1/2008. FLR(IGS): 1/2008 - 10/2008. FLR(M): 10/2008 - 10/2010. ILR 10/2010!!

Finn, 25/12/2009; Micah, 10/08/2012

Offline vadio

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Re: Back-filing taxes and question on state tax returns
« Reply #1 on: March 04, 2017, 09:14:18 PM »
Alas - the dreaded Virginia. They are one of the states that tries to hold onto you forever. We finally broke free after filing for change of domicile, and sending them everything aside from a kidney.

Yep, they will want you, and want your money, and the feds will tell them of a potential taxable event.
Married December 1992 (my 'old flame' whom I first met in the mid-70s)
1st move to UK - 1993 (Letter of Consent granted at British Embassy in Washington DC)
ILR - 1994 (1 year later - no fee way back then!)
Back to US in 2000
Returned to UK July 2011 (Spousal Visa/KOL endorsement)
ILR - September 2011
Application for naturalization submitted July 2014
Approval received 15-10-14; ceremony scheduled for 10 November!
Passport arrived 25 November 2014. Finally done!

Offline guya

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Re: Back-filing taxes and question on state tax returns
« Reply #2 on: March 05, 2017, 08:28:34 AM »
From an IRS perspective if you want to use the IRS offshore streamlined procedures, the IRS will want you to file the 3 years that are overdue - 2013, 2014 & 2015 today. Virginia may want 9 years worth of resident returns as this will make them money; but I'd start with just 6 years back for Virginia.

Offline Aless

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Re: Back-filing taxes and question on state tax returns
« Reply #3 on: March 07, 2017, 10:46:56 AM »
Alas - the dreaded Virginia. They are one of the states that tries to hold onto you forever. We finally broke free after filing for change of domicile, and sending them everything aside from a kidney.

Yep, they will want you, and want your money, and the feds will tell them of a potential taxable event.

thanks. Will start looking into Virginia, boo hoo. I had started filling out this year's online and it was extremely confusing. I think I do better with paper forms, to be honest. Unfortunately, short of changing the address on a US bank account, I've never done anything to establish domicile in another state so I'm likely stuck with Virginia until we're able to fully emigrate back to the US...oh well!
BUNAC: 9/2004 - 12/2004. Student visa: 1/2005 - 7/2005. Student visa #2: 9/2006 - 1/2008. FLR(IGS): 1/2008 - 10/2008. FLR(M): 10/2008 - 10/2010. ILR 10/2010!!

Finn, 25/12/2009; Micah, 10/08/2012

Offline Aless

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Re: Back-filing taxes and question on state tax returns
« Reply #4 on: March 07, 2017, 11:06:30 AM »
Aha! I don't think I need to file Virginia state returns, actually. Their forms and website (https://www.tax.virginia.gov/who-must-file) state that I only have to file if I have Virginia-based income above $11k. I'm going to take this to mean that since my income is not from the state of Virginia, I do not need to file. Additionally, even if a looser interpretation means that *any* federal AGI counts, that is actually a negative number (so, 0) on my federal return due the Foreign Earned Income Exclusion, so I'm still under their filing threshold.

I'm guessing the main complication will come in the year we move back, as I will be a "resident" of VA until we establish domicile in our new home (Colorado), so that's the year where I will need to file. I think!!
BUNAC: 9/2004 - 12/2004. Student visa: 1/2005 - 7/2005. Student visa #2: 9/2006 - 1/2008. FLR(IGS): 1/2008 - 10/2008. FLR(M): 10/2008 - 10/2010. ILR 10/2010!!

Finn, 25/12/2009; Micah, 10/08/2012

Offline discly

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Re: Back-filing taxes and question on state tax returns
« Reply #5 on: March 08, 2017, 02:24:11 AM »
And I suppose since you haven't had any U.S. source income you don't need to file a Federal tax return either. ;-)

Offline discly

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Re: Back-filing taxes and question on state tax returns
« Reply #6 on: March 08, 2017, 02:32:03 AM »
Did you complete lines 1-9 to determine your Virginia adjusted gross income?

Offline nun

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Re: Back-filing taxes and question on state tax returns
« Reply #7 on: March 09, 2017, 01:56:09 PM »
"A resident of Virginia who accepts employment in another country is a domiciliary resident, unless appropriate steps are taken to abandon Virginia as the state of domicile."

Don't you just hate that.

Offline vadio

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Re: Back-filing taxes and question on state tax returns
« Reply #8 on: March 11, 2017, 09:01:35 AM »
It took over 18 months from my first contact with the office of the Virginia Tax Commissioner to receipt of the final letter acknowledging that I was no longer a domiciliary resident of Virginia.

We had already taken MANY steps to break ties - owned no property or cars, were removed from the voter registration rolls, had no driver's license (actually, once you no longer live in Virginia you can't have one, and you are required by VA law to report any change of address within 30 days), changed to a foreign address on ALL financial accounts, and on and on. Bear in mind that DH is a Brit, and I had only lived in VA for 11 years, and was in my mid-60s when we began the process.

It was still onerous - copies of everything imaginable that related to our life in the UK, a form that asked many questions, proof of this, proof of that. Thankfully we had no children in VA or any other relatives there - any 'blood ties' can be used against you. I also researched multiple rulings from the office of the Tax Commissioner, to determine why someone succeeded, and why the change of domicile was refused.

It is not fun, not straightforward, and not easy, but it can be done. .Just don't assume that because you no longer live there, you're out of their control.
Married December 1992 (my 'old flame' whom I first met in the mid-70s)
1st move to UK - 1993 (Letter of Consent granted at British Embassy in Washington DC)
ILR - 1994 (1 year later - no fee way back then!)
Back to US in 2000
Returned to UK July 2011 (Spousal Visa/KOL endorsement)
ILR - September 2011
Application for naturalization submitted July 2014
Approval received 15-10-14; ceremony scheduled for 10 November!
Passport arrived 25 November 2014. Finally done!

Offline guya

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Re: Back-filing taxes and question on state tax returns
« Reply #9 on: March 11, 2017, 02:13:16 PM »
Do bear in mind that if you have now - or will ever have - assets valued over £325,000 that from a UK inheritance tax perspective it can save tens of thousands of pounds of inheritance tax to argue that one remains a Virginia domiciliary.