Filing jointly vs. separately (and some other questions)

Hello -- Can someone tell me what the general advantages/disadvantages are to filing US taxes jointly as a married couple, vs. separately?  On a recent post I saw that someone w/somewhat similar circumstances was advised to file separately, but a tax specialist had (informally) told me that I'd probably want to file jointly, without saying why.

More detail on our situation below.  Given the complexity, I know you will probably advise me to hire a specialist -- if possible, I'd like to take a first stab myself and have someone check it, just to save on the cost:

I am a US citizen, and my husband is a UK citizen w/a US green card.  We both moved to the UK last January and have been out of the US for over 330 days.  For the US 2006 tax year, I had no US wage income, minimal US investment/interest income, plus about $20,000 of self-employment income, all for work performed in the UK for a US company, which paid me US account in dollars.  Almost all of that money is still in my accounts in the US.  My husband had a small amount of US wage income from before the move, no interest income, and the rest of the time was paid by a UK employer (so presumably his UK tax is taken care of).   I have registered in the UK as self-employed and secured a National Insurance number. Oh, and to make things even more complicated, we moved here from California, where my US checking account is still based.

So far, for my US taxes I think I need to fill out the following forms:  1040, 3903 (moving expenses, as we paid for our own move and appear to qualify to claim the expenses), 2555, 1116, a Schedule SE and probably a Schedule C.  And, separately, TDF 90-22.1.   Plus CA 540NR for CA.  I think that's it so far, except that I'm just starting to investigate the foreign housing exclusion, and assume that if we end up wanting to claim that, I'll need a form for that as well.

Given the relatively small amount of money I made this year, I'm more worried about doing something incorrectly than saving the absolute maximum on taxes (although if I can save a bit by making a more intelligent election, e.g., in filing status that would be great).  For the same reasons, I'm more worried about any choices I make now that limit my options in the future.

Thanks in advance for your help!

If you do this yourself, use a programme like Turbotax to help.

I don't see why you'd want to file separately, as it usually has a higher tax.  Run your tax return both ways, and see which saves the most money.  Usually, MFJ is better.

Your husband must continue to file as a resident in order to keep his greencard valid with INS.  That means if he does take the Foreign Earned Income Exclusion (Form 2555), he can only use the Physical Presence Test, not the BonaFide Residence Test. 

As long as he has to file a US tax return as a resident (i.e., Form 1040), there's no reason why you shouldn't file jointly.  Unless MFS saves more $$, of course.

Thank you!

What's the best way to file in a situation where an american is married to a british person who has never lived or worked in the U.S. and the british person doesn't have a SS number and the american has not gone over the $80,000? Am i correct in assuming that one can not file single anymore?

What's the best way to file in a situation where an american is married to a british person who has never lived or worked in the U.S. and the british person doesn't have a SS number and the american has not gone over the $80,000? Am i correct in assuming that one can not file single anymore?

I believe you would file "married, but filing seperately".  When it asks for your husband's SS no, you would just put N/A - UK citizen.

Maybe someone can confirm this though!  I did it last year, but can't remember fully

I believe you would file "married, but filing seperately".  When it asks for your husband's SS no, you would just put N/A - UK citizen.

Maybe someone can confirm this though!  I did it last year, but can't remember fully

Yes, you file "married filing separately", but in the SS no. space put NRA (non-resident alien).