Hi,
I am on h1b (resident for tax purposes) and my spouse is on F1 (OPT).
Based on our calculations it would be beneficial to file as "married filing jointly".
We had the following questions-
1.) we were married in India, but did not register the marriage. Does the IRS consider this "legally married"? She has been living with me since april 2007 in california
2.) can i claim the education tax credit for the tuition paid for her during 2007
3.) she went to school in arizona. under what status do we file state tax returns?

Thanks in advance for your help!
Regards,
Retso

AtlantaTaxExpert

1) It does not matter where you got married, just as long as it is a legal marriage.

2) Yes.

3) In all state returns, you file jointly.

retso

Dear Atlantataxexpert
Thank you for your help.
One last thing:
When should she start paying Social security and medicare taxes since we are considering her a resident for tax purposes? Also do we need to file form 8843?
I must add that a large part of whatever little I know about filing taxes in the US is by reading your posts/replies on this board.
Thanks again!!
Retso

MukatA

If you file as resident as Married Filing Jointly, your wife is not exempt from FICA taxes.

May be it is better that you file as resident as Married Filing Separately and your wife files as nonresident. On her nonresident return she will also get standard deduction as per tax treaty between India and the U.S. She will also file form 8843.

AtlantaTaxExpert

She will HAVE to pay he FICA taxes in 2008 if you file jointly.

She will probably NOT have to pay FICA taxs retroactively for 2007, though.

retso

hi atlantataxexpert and muktaA,
thanks for your replies.
retso

AtlantaTaxExpert

Glad to help!

Guest

AtlantaTaxexpert is wrong

1) She does not have to pay FICA i.e medicare and social security for her income earned on OPT (F1) even in 2008. Once she moves away from that visa, she will have to pay social security and medicare.

2) You need attach a declaration signed by both of you saying you are filing as residents with your details

3) She won't have to file 8843 if you are filing joint return and treating her as resident

More details at

Nonresident Spouse Treated as a Resident

Also you can call up IRS with all your questions.

AtlantaTaxExpert

To GUEST:

I respectfully disagree.

When you attach the statement that you CHOOSE to be treated as a resident alien for all of 2007, that infers all the rights and responsibilities associated with that status, which INCLUDES paying FICA taxes.

I invite comment from the other tax experts who, unlike me, are currently monitoring this board and answering questions.

I KNOW what Texas Tax Expert will say, but I am curious what IntlTax has to say.

However, the link to the IRS website seems to state rather clearly that someone who files as a resident alien do NOT have to pay FICA taxes. I plan to communicate with TTE on this issue off-line.

The Texas Tax Expert

Guest,

This is a troublesome area of the law! While you are correct in terms of what the law says for the person who elects to be a resident in order to file jointly with their spouse, there seems to be a lot of uncertainty as to whether the IRS will actually pay back FICA withheld if a Resident return is filed. Gary Carter is probably the leading authority in this area and that seems to be his view. U.S. Tax Solutions for resident alien and nonresident alien foreign nationals

TTE