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TAXES! HELP!
Kuribo's Shoe
Kuribo's StockingNorth PoleRegistered User regular
Kuribo's StockingNorth PoleRegistered User regular
So I just got my W2, and due to some fuckup in my tax paperwork on some level (I assume) I only had $25 of federal taxes withheld from my pay last year. This has led me to possibly owe $302 in taxes to Uncle Sam. I am married, and filing jointly with my wife would turn that around in a big way, but she's a nonresident alien living up in Canada while we hash out all that fun paperwork. From what I've gathered poking around the IRS website, I still can file jointly with her but it requires some kind of weird paperwork, and I don't know if any of you guys know anything about this, but I felt I should ask, should I try and file jointly? Would it be worth it or would it cause a lot of trouble? Should I go to an accountant instead of trying to do it all online? Any help and or advice would be appreciated.
Kuribo's Shoe on
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What's your yearly income from the job/
$16,000
Looking at the IRS site makes it appear, to me, that if you file jointly her income for the year will be treated as US Citizen income for purposes of federal withholdings and taxation. I have no idea what Canadian tax law is like or even how the IRS treats the income of a US Citizen which was earned in a foreign country, but I would be willing to bet you a cookie that if you file jointly you will come out of it owing more money. The joint filing tax credit would alleviate some of your current taxes owed, but you'd have to take on the additional required taxes paid for your wife's salary.
All that said, this seems like one of those situations where you really need someone who has memorized the 2010 tax code in order to not fuck it up. I'd recommend either sucking it up and paying the $302 (and maybe making some of it back in state taxes? Assuming those were withheld properly?) or going to a tax prep company like HR Block or similar. They may be willing to tell you if it's worth your time when you walk in the door.
A few years back I was promoted from hourly to salaried manager and my boss was taking the same amount of taxes from my new income that he would regularly take from my hourly. As soon as I filed I was hit with a $1,800.00 tax bill from Uncle Sam. I filed for an extension at .5% interest and had it paid off by October.
The IRS will work with you if you can't pay it immediately.
If the above the true (that her income will be treated as US income), then filing jointly is probably a bad idea. Since she is resident in Canada, she will also need to pay Canadian income tax. The Canada-US tax treaty will apply (so she won't have to pay tax on everything twice), but the net effect is that she will have to pay tax on each portion of her income at whichever tax rate is higher (US or Canada). It can only hurt her and will make her taxes a fair amount more complex (and probably requiring the assistance of tax preparer in both countries).
Whether that is worth it to possibly reduce a relatively paltry $302 tax bill is up to you.
You'll probably qualify for the refundable $1,000 of the AOC tax credit. But you should have received that in 2009, too. :whistle: