[lmaruri]

Hi,

I am in US for 6 months (arrived on 04/27/07 along with my wife). I am on H1 visa and she is on H4 visa. I need to file the Tax returns for the year 2007. Before that I would like to apply for Tax Id for my wife.

I have the following questions :

1. I have my SSN and I need to apply for Tax id for my wife. How can I do that?
2. Could you please explain me the benefit of filing the tax returns jointly compared to filing it individually?

You may please help me.

Regds,
lmaruri

[mikemleo]

For #1:
1. There is a form: W7 available online at www.irs.gov/pub/irs-pdf/fw7.pdf
2. Take a print of this form and send it across to IRS with your Y2007 federal tax return.
3. You will need a form of ID (say passport copy) etc. Check the "How To Apply" section on page 2 of this form for more details. Also get all the copies notarized by a notary (Check with your bank, they might do it for free).
4. Send the completed form + your tax return to:
Internal Revenue Service
ITIN Operation
P.O. Box 149342
Austin, TX 78714-9342

5. I consulted a CPA before filing W7 for my wife. You might want to do the same this time at least.

For #2
Unless there is a pressing reason for filing separately (MFS) then filing jointly (MFJ) does result in lower overall taxation in *most* cases.

Reasons for filing MFS could include one spouse owing spousal or child support, one spouse having old tax debt or just one spouse isn't trust worthy. I've met quite a few client who just did not want to mix finances with their spouse for any reason.

If you do file MFS, you lose quite a few deductions and credits including tuition and fees deduction, student loan interst deduction and eductions credits. Other credits and benefits phase out much sooner including traditional IRAs, Roth IRAs and the child tax credit.

I would try your taxes both ways. Many tax preparation firms can gather all of your information and do a comparison of the two methods of filing.

[AtlantaTaxExpert]

Mike's posting is quite accurate.

The only thing I would add is that you MAY have the option of applying for the ITIN at your local IRS office. Call ahead and ask before you make the trip, as not every IRS office can work ITIN issues.

At the very least, the IRS office can certify (at no cost to you) that the passport photocopy is a true copy of your wife's passport. Such IRS certification is virtually guaranteed to be accepted at face value by the ITIN processing center in Austin, Texas.

[lmaruri]

Thanks a bunch guys!! :)

[AtlantaTaxExpert]

Glad to help!

[MukatA]

For #1:
1. There is a form: W7 available online at www.irs.gov/pub/irs-pdf/fw7.pdf
2. Take a print of this form and send it across to IRS with your Y2007 federal tax return...

Why do Imaruri has to wait till the 2007 return to file form W7? He can start the process now.

[mikemleo]

Why do Imaruri has to wait till the 2007 return to file form W7? He can start the process now.

I did the same thing for my wife and the W7 form was returned by IRS to me saying that the form should accompany my current year's tax return (not last year's). He can try but I just shared my experience!

Also its mentioned in the W7 required list of documents (#2):
"1. Your completed Form W-7.
2. Your original, completed tax return(s) for which the ITIN is needed. Attach Form W-7 to the front of your tax return. If you are applying for more than one ITIN for the same tax return (such as for a spouse or dependent(s)), attach all Forms W-7 to the same tax
return. After your Form W-7 has been processed, the IRS will assign an ITIN to the return and process the return."

[AtlantaTaxExpert]

MukatA:

I believe I covered this in another post.

The reason the IRS has restricted the application process is because the ITIN is supposed to be used EXCLUSIVELY to file taxes.

Unfortunately, they can be used for other purposes, like apply for credit. While the IRS accepts that the ITIN is being used for other leginimate purposes (like using it as an ID # for college students or on medical records), they wanted to cut back on the abusive uses (like applying for credit).