# Tax status and filing once married yet still living in separate countries



## jkwireless (Mar 25, 2014)

Greetings,

I married my partner in 2014 while he was on holiday to America and we both are still residents of our home country (him UK, me US) planning our next step on settling (most likely) in the US. It skipped my mind that as I file my US taxes this April 15th that I am no longer “single” and must either file “Married filing jointly” or “Married filing separately”. For this year, I am happy to file “married filing separately” even though it actually raises my tax bill while we work to sort things out. However in doing so, I see that the IRS wants a Social Security or alternate tax ID number listed for my spouse (which we don’t yet have). I do see that in the U.S. we can obtain an ITIN (alternate tax ID) number for my spouse, but that is generally used when wanting to treat my spouse as a resident for US tax purposes while retaining his non-resident alien status. I don’t understand what to do if I want to file separately and he still only filing a UK tax return (still get an ITIN for him in the US?), and/or if we now have a mutual responsibility to report income to each other’s country inasmuch as we only earn income in our home countries.

Then we get to the UK side of taxes – and I’m at a loss at what steps (if any) must be taken. My husband is a PAYE tax payer with a wage job, and while I don’t mind reporting his income on my US return, I don’t know what the reciprocal requirement is for him when it comes to me and my non-UK income.

Questions:
-	If I carry on and file my US return as “married filing separately” and my husband does not file a US return (continuing to pay taxes in the UK as he works), do I still need to obtain an ITIN ID number for him to list on my return, or do I attach an explanation as to why he doesn’t have one? 
-	OR, if I get him an ITIN and file “married filing jointly” – would I report his UK income as earned according to the US “calendar” tax year (rather than the UK “April to April” tax year) and list UK tax payments/withholding, etc. If I do this, what income documentation does the US typically require for foreign income?
-	What steps (if any) need be taken by my husband in the UK to update HMRC on our marital status and would that also mean that I go “on file” in the UK?
-	What filing requirements (if any) would we have to the UK either if he continues to file singly in UK, and also jointly on my US tax return?

Note that I don’t have large foreign accounts that trigger a reporting requirement, however if my UK husband looked towards the US, he is now listed on one of my accounts that sometimes exceeds the $10K amount (again, just not sure how things go when it comes to looking at spouse assets and reporting requirements from the UK perspective).

Any guidance or experiences would be greatly appreciated!


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## BBCWatcher (Dec 28, 2012)

If you check the instructions again for IRS Form 1040 (or its "sister" variants), you'll probably see that if your spouse is a non-resident alien and is not required to have a SSN or ITIN then you can write NRA in the space for your spouse's SSN or ITIN.

I'll ponder your other questions for just a little while longer....


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## BBCWatcher (Dec 28, 2012)

jkwireless said:


> Then we get to the UK side of taxes....


OK, now I understand. No, you don't get to the U.K. side in 2014 if you're Married Filing Separately and you (personally) do not have any income from the U.K. Your new spouse is completely out of the picture for your separate tax filing.



> My husband is a PAYE tax payer with a wage job, and while I don’t mind reporting his income on my US return....


Yes, you really would mind.  Don't do that. You're filing a separate return, not a joint one.



> OR, if I get him an ITIN and file “married filing jointly” – would I report his UK income as earned according to the US “calendar” tax year (rather than the UK “April to April” tax year) and list UK tax payments/withholding, etc. If I do this, what income documentation does the US typically require for foreign income?


OK, this is strictly up to your husband. He's under no obligation to participate in a joint U.S. tax filing with you, and you cannot force him to. (Well, not through conventional means anyway. )

If he wishes to participate in a joint U.S. tax filing for tax year 2014 he would make what's called a "Section 6013(g) Election." That requires attaching a cover letter to your joint tax return in the first tax year when the election is made. Once the election is made it can be revoked in future tax years, but if it's revoked you cannot ever go back to a joint filing unless and until your husband becomes a U.S. person (e.g. moves to the United States).

When on the U.S. side you and he follow U.S. rules. That means calendar year. It doesn't matter that the U.K. has a different tax year. He would report his calendar year income, foreign income tax paid on that calendar year income, etc., etc.



> What steps (if any) need be taken by my husband in the UK to update HMRC on our marital status and would that also mean that I go “on file” in the UK?


I don't know, but that's solely his responsibility to figure out, not yours. You're not a U.K. resident, have no U.K. income (apparently), and thus you have no HMRC obligations.

If HMRC offers a joint filing option then that'd also be solely your decision to make whether to participate or not.



> What filing requirements (if any) would we have to the UK either if he continues to file singly in UK, and also jointly on my US tax return?


That shouldn't matter. Each system has its own filing statuses and choices. You could each be filing separately in your respective countries, you could have a joint filing in one country but not in the other, or you could (if offered in the U.K.) have joint filings in both countries.



> Note that I don’t have large foreign accounts that trigger a reporting requirement, however if my UK husband looked towards the US, he is now listed on one of my accounts that sometimes exceeds the $10K amount (again, just not sure how things go when it comes to looking at spouse assets and reporting requirements from the UK perspective).


You have no U.S. _financial_ reporting obligations on U.S. financial accounts absent some very strange scenario where your joint account holder is, say, from North Korea. I'll assume your new husband isn't.  The fact you have a non-resident alien joint account holder doesn't mean you now have FBAR or FATCA reporting. It's still a U.S. account.

Of course you have to report the income from your accounts on your U.S. tax return: interest, dividends, and capital gains. That just got a little complicated when you added your new spouse as a joint account holder. What you might have done is allocated him some U.S. source income, a 50% share of the income from his joint accounts with you starting from the time he was added as a joint account holder. But you'll have to do some reading on interest income (for example) to determine whether that's correct.

If that's how it works then you'd have to calculate what your share of the income is, separating out your husband's share, then report your share on your separate U.S. tax return. The U.S.-U.K. tax treaty probably indicates how he'll need to handle his share of that income, whether he has to pay U.S. tax or U.K. tax on it. (It'll be one or the other.) If it's U.S. tax then he'd probably file IRS Form 1040NR to pay it. Or elect to file a joint return with you, as mentioned.

I'm not fond of joint accounts for a variety of reasons, and this is one of them. But it's "water under the bridge," so you'll just have to deal with it however it needs to be dealt with. (It certainly can be.) For the record, I prefer Payable on Death (PoD) arrangements on bank accounts, available in many U.S. states with most financial institutions in those states.


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## Bevdeforges (Nov 16, 2007)

Pretty much what BBCWatcher has already said. Let me just add a couple points that might help clarify things for you:



> Questions:
> - If I carry on and file my US return as “married filing separately” and my husband does not file a US return (continuing to pay taxes in the UK as he works), do I still need to obtain an ITIN ID number for him to list on my return, or do I attach an explanation as to why he doesn’t have one?


No - as was already said, if he has no US filing obligation, you should just put NRA where it asks for his ITIN.


> - OR, if I get him an ITIN and file “married filing jointly” – would I report his UK income as earned according to the US “calendar” tax year (rather than the UK “April to April” tax year) and list UK tax payments/withholding, etc. If I do this, what income documentation does the US typically require for foreign income?


If and when you decide (for any reason) to file jointly (normally in the year he arrives in the US to live - where you can then "elect" for him to file as a resident for the full year), you still have to figure his income based on the US calendar year. 

The good news is that US does not require any documentation for foreign income. It really does work on the "honor system" - see IRS Publication 54 for more information.


> - What steps (if any) need be taken by my husband in the UK to update HMRC on our marital status and would that also mean that I go “on file” in the UK?


Don't know just how the tax system works in the UK, but I suspect the first step would be for your husband to make sure his employer's HR department is aware of his change in marital status. That should trigger something (if only for his PAYE record) - and they should be able to advise him if there is anything else he needs to do.



> - What filing requirements (if any) would we have to the UK either if he continues to file singly in UK, and also jointly on my US tax return?


Frankly, neither side cares about your filing obligation to the "other" side. I wouldn't bother trying to file jointly for the US until and unless he joins you to settle in the US (i.e. with a green card). The first part-year he is resident in the US, you can elect to file together for the whole tax year - and that will actually simplify your tax filing to quite an extent.
Cheers,
Bev


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## theOAP (Aug 30, 2010)

With regards to the UK:

There is no "joint" filing in the UK. Each individual is taxed on their individual income. In the case of "joint accounts", (interest, etc.), each is taxed 50/50 if 2 owners for example.

There are Married Couples Allowance (both born before 1936) and Marriage Allowance (born after 1936), but these have special requirements. If interested, see gov.uk.


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## jkwireless (Mar 25, 2014)

Thanks you! to all who replied. I really appreciate your taking the time to both respond and to spell things out for me. This helped me to "get over the hump" and I will proceed with my MFS and use NRA on the return. We hope to be more settled in a year's time, but I hate when the paperwork takes precedence over the normal progression of life...

Again - many thanks!


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