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Topic: married filing jointly vs seperately  (Read 1627 times)

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married filing jointly vs seperately
« on: July 27, 2005, 01:10:25 PM »
I am a US citizen married to a UK citizen.

Previously we were both living and working (and married) in the US.  My wife had a Green Card.  During this time I just filed as "married filing jointly". 

Now we have moved to the UK.  As a US citizen I still have to file taxes.  As a UK citizen, though, surely my wife doesn't have to file taxes.

But, should I file as "married filing jointly" or "married filing seperately".  My wife does have a social security number, has paid taxes (jointly with me) before, and had been granted residency just before we left for the UK.

It doesn't make any difference this year, since she didn't earn anything anyway and all of my income can be excluded.  However, I can imagine a situation where our joint income couldn't be completely excluded.  In that case does it make more sense to file seperately just for me, or to file jointly and hope that the "married filing jointly" exemptions bring down our taxable income to a reasonable amount?  Or would filing seperately just on my own be in some sense _cheating_ since any income that she has just gets thrown in the pot used to support our whole family (2/3 of which are US citizens)?

Any thoughts?

Cheers.


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Re: married filing jointly vs seperately
« Reply #1 on: July 28, 2005, 02:29:20 AM »
As long as your wife has the green card, my understanding is that she would also be responsible for US taxes, but if I'm not mistaken she will lose her green card after being out of the country for more than six months, so after that point she would not have to pay US taxes. I believe that most likely it would be in your best interest to file "married filing seperately." Since it would only be your income that would be subject to US taxes, there is no need to add any additional income.


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Re: married filing jointly vs seperately
« Reply #2 on: July 28, 2005, 02:46:23 AM »
Just to add that your wife would have to turn in her green card if you don't want her to be considered a resident alien for tax purposes.

"However, green-card holders who reside outside the United States are still considered to be resident aliens of the United States for tax purposes unless such persons: (1) voluntarily turn in their green cards to USCIS and renounce their U.S. immigrant status; (2) have their immigrant status administratively revoked by USCIS; or (3) have their immigrant status judicially revoked by a United States federal court."

http://www.irs.gov/businesses/small/international/article/0,,id=129391,00.html


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Re: married filing jointly vs seperately
« Reply #3 on: July 30, 2005, 01:37:06 PM »
As long as your wife retains a greencard, she must file a US return.  If she should take any actions to give up her greencard, she will still be required to file a US tax return and considered a US taxpayer until such time as she files Form 8854, Initial and Annual Expatriation Information Statement.  This is true even in cases where the card is revoked involuntarily by INS for failure to meet greencard regulations.
Liz Z i t z o w, EA
British American Tax


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