All,

I'm a Canadian citizen working in NJ in the United States and have been recently married. I've been working in the US on an H1B as of Feb. of 2007. I've recently married (October of this year) and my wife has come down with me (from Canada) with an H4. My question is as follows:

- Am I entitled to list my wife as a spouse on my W4 given she's only been in the country since October? (Answering 1 to A,B,C on the W4 Personal Allowances Worksheet)

- Does the state of NJ require me to file an updated W4 as well, if so, I believe I require an ITIN number and I won't be able to receive this number until I file my 2008 federal tax returns. Does this mean I'll need to file the federal first, receive my ITIN and then file my state; or will I file both and file an amendment to my state return?

Thanks for all your help!

1) Yes, if your employer will allow it. The IRS has a rule that requires foreign national workers to submit W-4s as a SINGLE person with only one exemption, even though they may be married. This is done to ensure that said foreign national workers have enough taxes withheld to cover their tax liability and therefore will file their tax returns to recover the excess withholidng. However, married foreign nationals who intend to file jointly with their spouses are permitted to claim married with two exemptions. Most employers are NOT aware of this exception, so they FORCE their employees to file SINGLE with one exemption.

2) The state of NJ has a W-4 equivalent form on which you can also file Married with two exemptions.

Neither the W-4 nor the NJ equivalent requires an ITIN. I believe you are confusing the W-4 with the federal tax return (Form 1040) and/or the NH tax return (NJ Form 1040).

When you file your federal form 1040, you will file Form W-7 (with a notarzied photocopy of your spouse's passport stapled to the Form W-7) with the Form 1040 and mail it to the ITIN Operations Center at Austin, Texas. The IRS will evaluate the request, issue the ITIN, insert the ITIN where your spouse's SSN would go, process the return and mail your wife her ITIN.

Once she receives the ITIN in the mail, then (and only then) will you file your NJ tax return. Hence, expect to file the NJ return about six weeks AFTER you file the federal tax return.

Note that the sooner you file your federal return, the faster you will get the ITIN back. If you wait until Mach or April of 2009 to file, your wait for the ITIN could be up to three months.

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Originally Posted by AtlantaTaxExpert

1) Yes, if your employer will allow it. The IRS has a rule that requires foreign national workers to submit W-4s as a SINGLE person with only one exemption, even though they may be married. This is done to ensure that said foreign national workers have enough taxes withheld to cover their tax liability and therefore will file their tax returns to recover the excess withholidng. However, married foreign nationals who intend to file jointly with their spouses are permitted to claim married with two exemptions. Most employers are NOT aware of this exception, so they FORCE their employees to file SINGLE with one exemption.

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Thanks for the quick response ATE!

I did have a follow up question:

- Does my wife need to meet the substantial presence test to be considered a dependent and therefore an additional exception allowance on my W4?

If you are filing jointly with your wife, the Substantial Presence Test is NOT RELEVENT in her case.

You can file jointly with your spouse even if she remains in her home country. She could be on Mars for all the IRS cares.