My husband is a non resident alien, for most of 2016 I lived in Texas, a community property state. Do I have to claim any portion of his income if our domicile is not TX?

[beane123456789]

My husband is a not planning on becoming a US resident, and our home is permanently outside of the state of Texas. I have been living outside of Texas since September 2016. I had been unemployed for 95% of 2016. I received unemployment and found part time delivery work, tips only, for a few month early spring. I want to file separately, and I don't want to include any portion of his income. I am getting confused with the Texas community property laws for non resident alien spouses. Our domicile is not Texas, and I no longer live there. Do I have to include any portion of his income? As well the website is requesting a SSN# for him. Should and can I leave his information blank? My husband will not be filing a tax return since we don't live there and he has no business there. I am still unemployed and don't work. Will I run into any problems with my situation?

[GeoffreyG · Accepted solution]

This is a detailed answer to your question.  Please read through all of the information below so that you will understand everything you need to know.

If you are a United States citizen (or a resident alien) and are married to a non-citizen, who cannot otherwise qualify as a resident alien under either the Substantial Presence Test or the Green Card Test (as explained at the IRS link directly below), then you have some options on how to file your US tax return, although current United States tax laws do not make this process particularly easy.

https://www.irs.gov/individuals/international-taxpayers/determining-alien-tax-status

If your spouse can qualify as a resident alien, then the two of you together could file a normal Married Filing Joint income tax return (or the two of you could alternatively file as Marred Filing Separately).  Basically, if your spouse can qualify as a resident alien, then your spouse is essentially treated as a regular US citizen for tax purposes.

It is also helpful to point out that you cannot file a tax return as Single, and ignore your spouse, regardless of residency status.  (We mention that fact because we are sometimes asked.)  Additionally, it is useful to know that the IRS considers those persons who are married as of midnight on December 31st of the year to have been married the whole entire year, for income tax purpose.

Here are your (2) broad choices:

Option # 1:  You can file your US tax return as Married Filing Separately, and just report your own income there.  TurboTax can walk you through this process, and help you create the necessary Form 1040.  If your spouse does not already have an ITIN number, or a Social Security Number, then this return would have to further be printed and paper filed.  If your spouse has a valid ITIN or SSN, then the tax return would be eligible for e-filing.

If there is no ITIN or SSN, then in any place where the nonresident spouse's taxpayer ID number is required on a tax form, you would take a black or blue pen and manually write "nonresident alien" or abbreviate as "NRA."  In the TurboTax software, you can input any "made up" SSN or ITIN you want to, in order get through the program (we suggest 999-88-9999, 999-88-9998 or 999-88-9987, as those numbers won’t produce any TurboTax program errors in a review check) as a temporary "placeholder.”  You can then later "white out" that number when the paper pages are printed.

You can also claim a personal exemption for your spouse, if your spouse had no gross taxable income for U.S. tax purposes, and was not the dependent of another taxpayer.  This mirrors the similar rule for US citizens and resident aliens filing as Married Filing Separately to claim the personal (dependency) exemption for their spouse, where that spouse has no taxable income, is not filing a separate tax return, and is not claimed as a dependent on any other taxpayer’s return.  But, in order to do this and claim the personal exemption, your spouse must also have a valid Social Security Number or an ITIN.

Option # 2:  You can elect to include your nonresident spouse on your US income tax return (which may be more or less tax favorable than Married Filing Separately); and file as Married Filing Jointly; but you would need to file a paper Form 1040 tax return in order to do so.  The somewhat complicated process for completing this type of tax return is explained in detail at the IRS.gov website here:

https://www.irs.gov/individuals/international-taxpayers/u-s-citizens-and-resident-aliens-abroad...

Such a tax return (Option # 2) is probably best done by a professional tax preparer.

If you choose Option # 1 and have any difficultly with that, then having the tax return prepared by a professional is also an option here too.

TurboTax has a helpful Frequently Asked Questions webpage about claiming international spouses and children, and you may wish to look at that as well.  Here is the link:

https://turbotax.intuit.com/tax-tools/tax-tips/Taxes-101/Claiming-a-Non-Citizen-Spouse-and-Children-...

With respect to Texas and its Community Property laws, if you and your spouse are not "domiciled" in Texas for legal and tax purposes (and only living in the state temporarily), then you can safely ignore those Community Property income allocation rules, as they do not apply to you.  Thus, if you go with Option # 1 above, and elect to file your US tax return as Married Filing Separately, you will not need to include (or allocate to you) any of your nonresident alien spouse's income onto your own tax return.

You will, though, need to physically print your tax return and mail it, using the process described above for handling your spouse's lack of a SSN or ITIN number.

Thank you for asking this important question.

[surag0107]

I'm in a similar situation. My wife is a resident of Canada, and lived in Canada the whole of 2023. I lived in Texas in 2023. I'm filing with the "Married Filing Separately" status. Is there any part of my income that I need to allocate to her with the community property law?

[DaveF1006]

Yes, you do need to report income made by yourself and spouse according to Publication 555. On page 8, it explains that if you treat your spouse as a non-resident alien, you can , treat your community income as Spouses living apart all year. However, you don't have to meet the four conditions that are listed there.  Here is how you will report the income. 

You would report the income each of you made. You do not need to allocate it according to the community property rules. Page 9, illustrates a perfect example how this is done. Thus in the screens you included above, you would not make any adjustments because each income is treated separately. Otherwise, if you weren't given this special provision, you would need to allocate everything bit of income, withholding, and deductions 50/50, which may take a bit of work.

If your wife does not have an ITIN or Social Security Number, you will need to mail the return in accordance with the instructions that will be included in the return. 

1. Prepare your return in TurboTax by choosing the option as Married Filing Separately. For the Social Security number, If she doesn't have a Social Security Number or ITIN, leave that blank.
2. Complete your return.
3. When you get to the Let’s get ready to e-file screen, select File by Mail, unless your wife has a SSN or ITIN. If so, you may efile.
4. TurboTax will give you an error regarding the missing Social Security number or ITIN for your spouse. Proceed to print with the error, but write Nonresident Alien or NRA in the space for your spouse’s Social Security number before mailing in your return.
5. Mail the return to the address on the instruction sheet that prints with the return.
6. You may include an explanation stating that your wife is a non-resident alien that lived abroad during the year thus you did not make the community property allocations and treated her as a Spouse living apart from you all year and then quote the text that is on page 8 of Publication 555.

@surag0107 

[surag0107]

Thanks, Dave. In my case, my wife does have a social security number, but no US income. Since she has an SSN, I'm eligible to e-file, but this would mean I can't attach a physical explanation letter. What would I do in this case?

[DaveF1006]

You would still report the income but you do not need to allocate it 50/50 as I explain in my second paragraph. Then you will be able to efile the form and this would not require any attachments.

If the IRS inquires on why your wife did not report her income, you would explain to them that she is not a resident alien for tax purposes. You are treating this income as explained under Spouses Living Apart all year in Publication 555 and meet the 4 requirements for this requirement. 

@surag0107