Unique Filing Status and Exemption Situations Flashcards
Does filing as a resident alien affect the persons immigration status?
Filing a tax return as a resident alien does not affect the person’s immigration status in any way.
If the taxpayer checked “No” for U.S. citizen on the intake and interview sheet, you must determine if the person meets one of the two tests to be treated as a resident alien for tax purposes:
The green card test
The substantial presence test
An individual who does not meet one of these two tests is considered to be a nonresident alien.
Individuals who do not have green cards may still be considered resident aliens if they meet the requirements of the substantial presence test for the calendar year. To meet this test, an individual must be physically present in the United States on at least:
31 days during the current year, and
183 days during the 3-year period that includes the current year and the two years immediately before that, counting:
All the days he or she was present in 2014 (current year) and
1/3 of the days he or she was present in 2013 (first year before current year) and
1/6 of the days he or she was present in 2012 (second year before current year)
For the substantial presence test, do not count days for which an individual is “exempt.” The term “exempt individual” does not refer to someone exempt from U.S. tax, but to anyone in the following categories:
An individual temporarily present in the United States as a foreign-government-related individual
A teacher or trainee, temporarily present in the United States under a J or Q visa, who substantially complies with the requirements of the visa
A student, temporarily present in the United States under an F, J, M, or Q visa, who substantially complies with the requirements of the visa
A professional athlete temporarily in the United States to compete in a charitable sports event
These taxpayers must follow the rules described in Forms 1040NR or 1040NR-EZ instructions. Refer these individuals to a VITA site that prepares tax returns for foreign students or to a professional tax preparer.
Recall from the Personal Exemptions lesson that each taxpayer is allowed a personal exemption (unless the taxpayer is claimed by someone else). Taxpayers who file a joint return may claim their spouse’s personal exemption. On a Married Filing Separate return, taxpayers may claim their spouse’s personal exemption only if
the spouse had no gross income, was not filing their own return, and could not be claimed as a dependent by anyone else.
Can a spouse be claimed as a dependent?
Remember, a spouse can never be claimed as a dependent of the taxpayer.
Can a taxpayer use a MFJ status and make their nra spouse a RA spouse?
If a taxpayer, who is a U.S. citizen or resident alien, is married to a nonresident alien, the taxpayer can choose to treat the nonresident alien spouse as a U.S. resident for tax purposes and file Married Filing Jointly.
To designate a nonresident alien spouse as a resident alien on a joint return, taxpayers must attach a statement that contains the following information and is signed by both spouses:
A declaration that one spouse was a nonresident alien and the other spouse a U.S. citizen or resident alien on the last day of the tax year, and that the taxpayer and spouse chose to be treated as U.S. residents for the entire tax year, and
The name, address, and social security number or ITIN of each spouse. (If one spouse is deceased, include the name and address of the person making the choice for the deceased spouse.)
What publication has more details on NRA and RA?
Publication 519 and 596 and 17
As you learned in a previous lesson, married taxpayers can be considered unmarried and claim Head of Household status if they have not lived with their spouse for the last six months of the year, and if they meet a few other requirements.
There is an exception that allows taxpayers who have a nonresident alien spouse to file as Head of Household. All of the following requirements must be met:
The taxpayer is a U.S. citizen or resident alien for the entire year.
The nonresident alien spouse chooses not to file a joint return.
The taxpayer meets the other requirements for this filing status.
The spouse is not a qualifying person for head of household purposes. The taxpayer must have a qualifying person in order to be eligible for this filing status.
In order for a nonresident alien spouse to be claimed as a personal exemption of the citizen or resident alien Married Filing Separately return, the spouse:
- Must not have any gross income for U.S. tax purposes
- Cannot be the dependent of another U.S. taxpayer
- Must have an Individual Taxpayer Identification Number (ITIN) or a Social Security Number (SSN)
When Edward Chambers and his wife Lucia got married in January, Lucia was a nonresident alien. In June, Lucia obtained her green card and became a resident alien. She remained a resident for the rest of the year. Lucia wants to be treated as a resident alien for the entire year for tax purposes. Can she use the Married Filing Separately status?
Taxpayers and their spouses who choose to be treated as resident aliens must file a joint return for the year that they make the choice, but can file joint or separate returns for later years.
Mark Gibson, a U.S. citizen, lives in Italy. His wife, Liliana, is an Italian citizen and has never lived in the U.S. She earned income in the tax year by working full time at her family’s restaurant in Italy. She has an ITIN and no other taxpayer can claim her as a dependent. Which of the following statements is true?
Mark can file a Married Filing Separate return and claim his spouse as a personal exemption
Can HOH who has NRA spouse receive EIC?
If a taxpayer with a nonresident alien spouse is filing as Head of Household, enter NRA on the head of household line of Form 1040. The word No should appear on the dotted line next to the earned income credit line of Form 1040.
What happens if 2 US citizens have a child abroad
The birth of a child abroad should be reported as soon as possible for the purpose of establishing an official record of the child’s claim to U.S. citizenship. Form FS-240, Consular Report of Birth Abroad, establishes official evidence that a child is a U.S. citizen.
