Hello,
I hope someone can offer me some advise regarding USA / Canada Taxes
My situation:
I am an American Citizen living and working in USA (Boston MA)
My wife is a Canadian Citizen living and Working in Canada (Cambridge ON)
We were recently married on Nov. 12 2010. We currently live apart in our respective countries.
My question is: What does tax law say about our situation?
Do we file a joint return just because we are married?
but we dont live in the same country and have seperate households, so does that exclude us from a joint return?
Do we file in both countries?
Im confused...thanks for everyone's help in advance....
American Living in USA Married to CDN Living in Can-Taxes?
Moderator: Mark T Serbinski CA CPA
First, you have no Cdn tax obligation. Your spouse does have to say she is married on her cdn tax return, and must simply report your income at one place on page 1, in order to not recieve any low income credits. But that is it.
For US, you do need to file as married. But you do not have to file jointly. However, filing separately (MFS) may result in higher taxes for you. Most in your situation would file jointly, and indicate that she is a non-resident alien. because she is Cdn, you are entitled to her exemption, so should request an ITIN for her with your 2010 return. You would include her income on this return, but various tax credits etc will eliminate any extrat tax on her income on your 1040.
It is more complicated, but should result as if she lived in US with no income.
For US, you do need to file as married. But you do not have to file jointly. However, filing separately (MFS) may result in higher taxes for you. Most in your situation would file jointly, and indicate that she is a non-resident alien. because she is Cdn, you are entitled to her exemption, so should request an ITIN for her with your 2010 return. You would include her income on this return, but various tax credits etc will eliminate any extrat tax on her income on your 1040.
It is more complicated, but should result as if she lived in US with no income.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best
I understood your initial post.
There is no Cdn "joint" return. However, foreign spouse's income is used to determine some credits, that is why it would simply need to be entered for informational purposes.
You do not have to file a joint return (MFJ) in US, however it will likely be to your advantage over a Married filing separate (MFS) return. If she has no US income, you can file Married separate, but still use her exemption.
The situation is a littlre complicated, but hiring a specialist will be quite expensive ($1K+), even for one year, and you would then want to use this return as a template for future years, but since it is unlikely that this situation will last a long time, you may not get much return on your investment. Probaly not as much savings as filing MFS on your own.
If you simply treat her as if she was a US citizen abroad and file MFJ, I'm quite sure any number of CPAs acould figure this out.
There is no Cdn "joint" return. However, foreign spouse's income is used to determine some credits, that is why it would simply need to be entered for informational purposes.
You do not have to file a joint return (MFJ) in US, however it will likely be to your advantage over a Married filing separate (MFS) return. If she has no US income, you can file Married separate, but still use her exemption.
The situation is a littlre complicated, but hiring a specialist will be quite expensive ($1K+), even for one year, and you would then want to use this return as a template for future years, but since it is unlikely that this situation will last a long time, you may not get much return on your investment. Probaly not as much savings as filing MFS on your own.
If you simply treat her as if she was a US citizen abroad and file MFJ, I'm quite sure any number of CPAs acould figure this out.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best