Does she have a valid Tax ID in the USA? You have to have one for all claimed dependents.

Did she earn her money in the USA? Or Canada, I assume you earned yours here in the USA. The Non-resident canadian part has me confused.

No, she does not have a tx id as of yet. We were married in January of 2010 and she moved to the States later in the year. She earned money in Canada in 2010 but none in the US. We are in the immigration process but have no official designation for her as of yet. It may come before tax time but we are unsure. My step daughter's situation is the same except for having not earned money in Canada in 2010.

I'll say no with a caveat... Until she has a taxpayer ID (Its in leu of an SSI as an ID), you can't claim her as a dependent I would see if you can get one for both of them before tax time so you will be able to claim them both. I forget the exact name its called. But the IRS will reject and flag any return with a claimed depenent without the required ID. Blame people double claiming kids and phantom dependents over the years.. they cracked down on it about 20 years ago. Its not too late. Get them before you file your taxes and you can claim both for the 2010 tax year.

If you are a U.S. citizen or resident you can only file as married filing jointly or married filing separately. You can file joint return as residents even when your spouse has never been to the U.S. http://taxipay.blogspot.com/2008/02/filing-status-for-married.html
On the joint return, both of you must report worldwide income.
If you spouse does not have SSN, attach W-7 (ITIN application) with your tax return.
Your U.S. Tax Return: U.S. Citizen or Resident with Foreign Income (http://taxipay.blogspot.com/2008/03/us-citizen-or-resident-with-foreign.html)

I agree with MukatA; his analysis is right on.

If you need help filing such a return with Form W-7, email me at [email protected] with details for an refund estimate and a fee quote.