[etmum]

I would be very grateful for anyone's help!

We have a slightly complicated situation - my husband (who is not from the US) is on a H-1B visa and has lived and worked in the US since April 2009. I am British, and on a H4 visa and still live in the UK, where I work full time. (Both my husband and I have SSN, which were issued in 2001 when my husband worked in another job - he held a J-1 visa and I had a J-2 visa).

In 2011, we had a daughter and I spent my maternity leave (January 2011 until end August 2011) with my husband in California. I returned to work in the UK after returning from the US.

For our tax returns, when we filed in 2011 we were advised by a Tax consultant that we had to file a joint return and declare my UK income, but claim tax exemption for this foreign salary - however because my UK salary combined with my husband's USA salary meant that he hit the higher tax band, we had to pay the IRS/State tax totalling $6000. In the next tax year (i.e. this year's filing), my maternity benefits were low and therefore meant that the aforementioned situation did not occur, and together with a deducation for our daughter, we only had to pay extra State tax.

Our worry is the following - for next year's filing, even though I am living and working the whole year in the UK, will we have to make a joint claim and therefore be subject to more tax since our combined income will put us into a higher tax bracket? Since I am being fully taxed in the UK, I find this incredibly unfair since we are supporting two households and having to pay for childcare in the UK. In 2012 I have only visited the US for 26 days.

We have recently been told that the IRS has rejected an appliation for a ITIN number for our child, and therefore our tax returns are a mess.

Can anyone advise? Every time we phone the IRS we get different advice.

[AtlantaTaxExpert]

You are NOT required to file jointly; your husband CAN file Married Filing Separately.

However, if you file jointly and declare your U.K. income, you can then EXCLUDE the income using Form 2555 (if you qualify) or file Form 1116 to claim the Foreign Tax Credit to offset any double taxation.

I would have to SEE the 2010 and 2011 tax returns to see if they were prepared properly. If you want to discuss this, email me at my email address below (or in my profile if you cannot see it) and I can provide more detailed analysis.

The ITIN application for 2011 may have been denied due to new requirements for certifying the passport photocopies. If I review the returns, I could help you with that as well.

Email me; this IS what I do!