File MFS but no SS number for non-citizen spouse

[Possi]

I have a new client coming in today. She is selling hand-crafted jewelry out of her home. 

Her husband is not a US citizen or resident. He lives in (I don't remember) some other country and he isn't required to file a tax return. She has not been required to file a return until this business took off. 

They have a college age son (20). 

Dad completely supports his family financially.

Dad visits but can only stay for short times as his VISA or whatever card allows him.

Can you tell I'm really disinterested? But a real good client referred her, so I need to at least entertain the thought of doing this return. 

If I file her as MSF, I would need his SS number, and he doesn't have one. So, what do I do?

Other than sending her away, can anyone help me? 

 

[ILLMAS]

US person can apply for an ITIN for the spouse and file MFS at the same time, see form W-7.

[Lynn EA USTCP in Louisiana]

you could file MFS without an ID number for him - it would be a paper/mailed return.

[Catherine]

5 minutes ago, Lynn EA USTCP in Louisiana said:

it would be a paper/mailed return

Yes, and I'd add the Disclosure statement form, that non-citizen non-resident spouse is not required to have an ITIN.  But then, I like to drown them in paper so they have no excuse not to accept what my clients send in.  (Else my client would get a letter asking why we did not provide the ITIN that isn't required. YMMV.)

[Possi]

3 hours ago, Catherine said:

Yes, and I'd add the Disclosure statement form, that non-citizen non-resident spouse is not required to have an ITIN.  But then, I like to drown them in paper so they have no excuse not to accept what my clients send in.  (Else my client would get a letter asking why we did not provide the ITIN that isn't required. YMMV.)

Is that a special FORM? 

[PatHack]

You should be able to efile through ATX.  On 1040, first tab "Main Info" there's a checkbox in a horrible spot this year, under FOR STATE RETURN PURPOSES, put a checkmark in box next to "Check if spouse is nonresident alien, does not have and is not required to have SSN or ITIN."

I have efiled spouses with w/o SSN/ITINs for a number of years w/ ATX.

Unsolicited tips (worth the price paid)

1) be careful the US spouse may have signing authority over a non-US bank account or non-US investments (FBAR/8938)

2) if the NRA is paying for everything, there's a possibility that the payments may be treated as gifts. If gifts are over $100k for a year from the NRA, US taxpayer will report it on 3520 filed separate from 1040.

3) suggest that NRA gifts to US taxpayer instead of NRA paying expenses directly, then US taxpayer can pay for her own living expenses and those of their son.  If son is dependent, US taxpayer would be treated as HoH and have better tax bracket & std deduction.

4) make sure NRA counts days to avoid substantial presence in the US. 122 days on average over 3 years or potentially a treaty may allow up to 182.

 

[Catherine]

2 hours ago, Possi said:

Is that a special FORM? 

Form 8275 I think is the number.  General "explain what we don't have a form for" form.  Don't say that three times fast, it will take emergency services to un-tie your tongue!

[Possi]

Thanks!

[Pacun]

5 hours ago, PatHack said:

You should be able to efile through ATX.  On 1040, first tab "Main Info" there's a checkbox in a horrible spot this year, under FOR STATE RETURN PURPOSES, put a checkmark in box next to "Check if spouse is nonresident alien, does not have and is not required to have SSN or ITIN."

I have efiled spouses with w/o SSN/ITINs for a number of years w/ ATX.

Unsolicited tips (worth the price paid)

1) be careful the US spouse may have signing authority over a non-US bank account or non-US investments (FBAR/8938)

2) if the NRA is paying for everything, there's a possibility that the payments may be treated as gifts. If gifts are over $100k for a year from the NRA, US taxpayer will report it on 3520 filed separate from 1040.

3) suggest that NRA gifts to US taxpayer instead of NRA paying expenses directly, then US taxpayer can pay for her own living expenses and those of their son.  If son is dependent, US taxpayer would be treated as HoH and have better tax bracket & std deduction.

4) make sure NRA counts days to avoid substantial presence in the US. 122 days on average over 3 years or potentially a treaty may allow up to 182.

 

Excellent post but a husband will never gift to wife, if I am not mistaken.

If they agree to file jointly, they have to report global income and get an ITIN for husband. Attach a letter to the return stating they are married and they both agree to file as a resident for tax purposes and that they are reporting global income.

[PatHack]

Gifts between spouses are common, and generally subject to a 100% marital exclusion if both spouses are US citizens.  However, gifts from a US spouse to their NRA/non-citizen spouse (which includes green card holders) are subject to an annual max exclusion (2018 = $152k). On the flipside, an NRA spouse can give everything to a US citizen spouse.

I can't be certain that Possi's facts would be a gift, more facts would be needed, but on the face of it, if one spouse is paying for the other spouse's accommodations & living expenses that are not same principal location as the paying spouse, it looks like a gift.  There will be arguments both ways.

Re: joint filing. It is unlikely that they will want to file a joint return.  It appears that the husband has wealth outside the US which would complicate the US tax return and subject his income to US tax.

[PatHack]

Please don't attach in 8275.  It is used for other reasons, not for a missing SSN/ITIN of a non-resident spouse, nor would it be appropriate for a missing SSN of a dependent.

Follow the 1040 instructions - under MARRIED FILING SEPARATELY (page 15 of PDF instructions). "If your spouse doesn’t have and isn’t required to have an SSN or ITIN, enter “NRA.”

The way to get ATX to put NRA in the box is shown in my original post.

[Possi]

On 2/5/2019 at 9:28 AM, PatHack said:

Please don't attach in 8275.  It is used for other reasons, not for a missing SSN/ITIN of a non-resident spouse, nor would it be appropriate for a missing SSN of a dependent.

Follow the 1040 instructions - under MARRIED FILING SEPARATELY (page 15 of PDF instructions). "If your spouse doesn’t have and isn’t required to have an SSN or ITIN, enter “NRA.”

The way to get ATX to put NRA in the box is shown in my original post.

I am the red-headed step child using TaxWise, but I will look into this. Thanks! 

[Possi]

I'm just getting to this return. 

I'm going to file MFS, paper return with "NRA" handwritten for his SS number because Taxwise doesn't have another way to print it on the form. I will also attach a "preparer notes" form with my statement regarding the spouse, and why the SS isn't required. 

I am not filing her as HOH with her son who is in college because the husband supports the household from England, his home. He only visits a few times a year. 

Thanks for all your help. 

[SaraEA]

I did one of these today.  Spouse is a US citizen and husband lives in another country.  Return was MFS, and I just marked the box that he was a nonresident alien.  No problem with efile.  UT has this box, and I'll bet the other softwares do too, you just have to look for it.