You work abroad, you fell in love with a non-U.S. citizen, you got married, how do you file your U.S. taxes? Expatriate Tax Returns can help you with the nuances of status and expat tax requirements. Everyone’s situation is unique and it is very beneficial to have expat tax experts file your return on your behalf.
There are decisions to be made if you married a non-resident alien (NRA). A U.S. green card holder past or present does not fit into this equation.
How do you know if you should claim your spouse or not on your U.S. tax return?
The answer is…..it depends. When deciding whether to claim your spouse, you need to consider your projected future earnings and ambitions.
Is your marriage considered valid in the eyes of the United States?
If you qualify, there are several options for filing including:
- Married Filing Jointly
- Married Filing Separately
- Head of Household
If your spouse is considered a non-resident alien (NRA), you may wish to change their status to a resident alien. This is especially true if they eventually want to receive their U.S. green card and have a pathway to citizenship.
Why would you want to be “Married Filing Jointly”? You can usually double your deductions and receive tax credits that are not otherwise available to you such as the Foreign Earned Income Exclusion. This will only help you if your joint income will never exceed the FEIE limit per household. Also, if your spouse has no income or makes very little, this can possibly put you in a lower tax bracket and lower your tax rate. It is important to remember that this decision is permanent if you stay married, you can’t change your spouse’s status once you elect this option, so if your spouse’s unemployment or low wages is temporary, if they may inherit money, etc., this may not be the best option for you.
If your spouse maintains their non-resident alien status, they are free of U.S. tax obligation (unless they have U.S. income).
You will then need to choose the following options:
- Married Filing Separately (if you have no dependent children)
- Head of Household (if you have children)
There are many conditions you need to meet to qualify for head of household. Depending on your children’s citizenship it may be an easy or more difficult decision for you.
There are benefits and disadvantages to each type of filing, so it is important to understand all of the nuances to be able to choose what is the best option for you. American tax laws are complex, involved and changing. Contact Expatriate Tax Returns, expat tax experts, to learn more about what is required or to get started on your tax filing.