Question about Child Credit - wife working in US

octane99 · Post by **octane99** » Mon Jan 21, 2008 7:51 pm

One of my friend's wife went to Los Angels last October for a new graduate job offer. Her husbans stays in Toronto.

I used knowledge I learned here to give them some tax advice. I believe that since the husband make much more money. It does not make sense for them to file jointly in US. Therefore, wife can file separately in US, then they will both file in Canada.

Now, if their kid stays in Canada, Can the wife claim Child credit in US tax return even if she do Married File Separately? ( I think she can claim that the child lived with her for more than 6 months before she went to US).

Thank you for the help.

nelsona · Post by **nelsona** » Mon Jan 21, 2008 8:38 pm

The problem with the child tax credit is that the child has to have a SSN, not just an ITIN.

So, while in principle she should probably file MFS, and can claim her spouse (with no US income) and child as dependents (since they are Cdn), she may have trouble collecting the $1000 child credit due to his citizenship.

I would try it and see, there is nothing to lose.

cullen · Post by **cullen** » Wed Jan 23, 2008 6:01 am

You can use the ITIN
http://www.irs.gov/faqs/faq7-2.html

nelsona · Post by **nelsona** » Wed Jan 23, 2008 9:19 am

Thanks for the update, this is a new position, as previously the "resident Alien for tax purposes" was not an alternative, and SSN was required.

This bring the treaty provision for dependants in force for Cdns.

octane99 · Post by **octane99** » Wed Jan 23, 2008 9:55 pm

Thank you all for reply.

I want want you know that I did collect Child credit in the last two years even my kid does not have a SSN. I use ITIN too as I think I can use Treaty clause.

nelsona · Post by **nelsona** » Thu Jan 24, 2008 7:07 am

As the credit was written, the treaty clause did not apply, since citizenship or residence was not the isse, the SSN was. We discussed this 2 years ago.

Since they have apparently removed the SSN clause, this apparntly opens up ALL Cdns to the possibility of collecting $1000 per child from IRS, with the same income requirements as Americans.

canuckmom · Post by **canuckmom** » Mon Jan 28, 2008 1:09 pm

I believe we claimed and got child tax credit for our children last year for a husband with job and SSN, wife and children with ITIN.

Is there also something for childcare? Does childcare require 2 parents to be working? Does it have an income ceiling?

nelsona · Post by **nelsona** » Mon Jan 28, 2008 1:36 pm

Yes, bith paprents need to have worked in the year to claim these expenses.

There may be other execepotions (school, unemployment, etc), but US views childcare for stay-at-home moms as optional, and not something that deserves tax credit/deduction.