My wife and I are currently living in Paris, France. She is on a US contract and I am under a French contract. This next tax year will be our first as a married couple. She will be filing a US tax return and I am wondering if she will gain the tax benefits of our marraige.
-- Harry
Married - Tax benefits
Moderator: Mark T Serbinski CA CPA
Ok.
Now, You say she will be 'paying' US taxes. I know she will be reporting her income in US, but that does not necessarily mean she will be paying US taxes, as she is probably entitled to the foreign earned income exclusion (about $80K US) since she works outside US.
Is she paying French Income tax? Are You?
Are you a Cdn resident for tax purposes, or have you severed ties? This matters in the sense that Cdn <i>resident </i> spouses of US citizens are given special treatment by the IRS, but not Cdn <i>citizen </i> spouses living outside canada.
<i>nelsona non grata... and non pro</i>
Now, You say she will be 'paying' US taxes. I know she will be reporting her income in US, but that does not necessarily mean she will be paying US taxes, as she is probably entitled to the foreign earned income exclusion (about $80K US) since she works outside US.
Is she paying French Income tax? Are You?
Are you a Cdn resident for tax purposes, or have you severed ties? This matters in the sense that Cdn <i>resident </i> spouses of US citizens are given special treatment by the IRS, but not Cdn <i>citizen </i> spouses living outside canada.
<i>nelsona non grata... and non pro</i>
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica" id="quote">quote:<hr height="1" noshade id="quote">any income I generate in Canada will be filed under my French income tax<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
Could be. However, I am not aware of ANY treaty provision that excludes Cdn income from Cdn taxation, so you will also be paying Cdn tax on Cdn-sourced income. It would be falt NR tax (25% on RRSPS fore example, and you should alrady be paying NR tax on any rent you get).
If you file jointly with your US wife, you will also be subject to US taxation on your Cdn-source income, subject of course to any foreign tax credit.
So, to answer your origianl question, NO, there will be no US tax advantage to your marriage, there may be a true marriage penalty, and her tax situation will become drastically more complex.
<i>Bonne Chance</i>
<i>nelsona non grata... and non pro</i>
Could be. However, I am not aware of ANY treaty provision that excludes Cdn income from Cdn taxation, so you will also be paying Cdn tax on Cdn-sourced income. It would be falt NR tax (25% on RRSPS fore example, and you should alrady be paying NR tax on any rent you get).
If you file jointly with your US wife, you will also be subject to US taxation on your Cdn-source income, subject of course to any foreign tax credit.
So, to answer your origianl question, NO, there will be no US tax advantage to your marriage, there may be a true marriage penalty, and her tax situation will become drastically more complex.
<i>Bonne Chance</i>
<i>nelsona non grata... and non pro</i>