Tax liability for GC holder In India

[gcmani]

My Brother-In-Law is a US Green Card holder from 2001, but living in India from late 2004. He visited US couple of times during this time to maintain the Permanent Resident status. He also has Re-Entry permit. He is eligible to apply for citizenship in May 2006. He is married in 2002 and has a kid. His wife lived in US for 2 years in 2002-2004 on H1 but she left for India in 2004 after the expirty of the visa. My BIL wanted to sponsor the Green Card for his wife once he gets citizenship and then bring her back to USA instead of she living here on H1 visa. To continue preserving his permanent resident status, he is obligated to file taxes as a resident for 2005. His only income would be about $6K from Interest and $10K one contract work he did briefly.
(total $15K) Here we have couple of questions.

1) Should he be filing as "married filing separately" (since his wife is lives in India) or "married filing jointly"?

2) Can he show his wife and kid as dependents even though they did not live
in USA during the year 2004

3) What would be the total income tax approximately

Thanks
gcmani

[asrivang]

I suggest you better contact a tax consultant.

[howdy_howdy]

gcmani:

Your BIL can file for taxes with "married filing joinly" clause/condition +
can also include his kids as dependents, provided your
BIL filed taxes when his wife & kids were in the US.

I mean, your BIL SHOULD have filed atleast once when his wife
and his kids were in the US. Also, if his wife has an SSN or
Taxpayer's ID and the kids should have SSN's to prove his case,
in addition.

Filing taxes for the dependents when they are not physically in the
US will cause problems.

Hope this helps.
//

ps: I am not a lawyer nor a tax consultant. Hiring a competent
attorney/CPA is prescribed.

[gcmani]

howdy_howdy

Thanks for the reply.

Actually my brother did file taxes jointly during 2002 plus, with his kid as dependent in 2003 and 2004. But his wife and kid were in India during 2005. Since he must file taxes for 2005 as Resident , the question is can he include them in the filing? (his wife has no us resiedent status during 2005, and the kid is citizen)

Thanks

[thukralrk]

Per my knowledge, No he cannot. I remember someone in similar situation few years back when the person was in US on H1b and his family (wife and kids) were in India, and a tax consultant told him that he cannot calim his wife and children as dependents, also he was advised to file as a 'Single'. But better a tax consultant.

Thanks

[catch_22_4_GC]

Originally Posted by gcmani

howdy_howdy

Thanks for the reply.

Actually my brother did file taxes jointly during 2002 plus, with his kid as dependent in 2003 and 2004. But his wife and kid were in India during 2005. Since he must file taxes for 2005 as Resident , the question is can he include them in the filing? (his wife has no us resiedent status during 2005, and the kid is citizen)

Thanks

I think there is some rule in IRS that mentions that in case you file married jointly, then the 'primary' (meaning your BIL) can choose 'resident' status for the dependents even if they do not pass the 'Resident test' as presribed by IRS. Again this is for tax purposes only and cannot be used to claim immigration benefts. I believe that as long as the wife and kid have either an SSN or ITIN they should be fine to file taxes as 'Married filing jointly'.
http://www.irs.gov/businesses/small/...=96734,00.html

check this out for complete tax info:

http://www.irs.gov/businesses/small/...=97324,00.html

[howdy_howdy]

gcmani:

As long as the dependent is maintaining the status in the US, there
should NOT be a problem to file with "married filing jointly" condition.

If your BIL's wife lost her status (still having SSN) doesn't qualify
for her to become his dependent; but he can use his child's SSN to claim
deductions.

Ask your BIL to send out a form to USCIS (I forget what it is) to notify
that his wife is NO longer living in this country and left the country for good.
As otherwise, IRS would expect her to file taxes every year and failing
to do so will result in huge fine later when IRS does auditing; this will
also be a problem when there is any RFE (on tax filings) for her during
GC and/or citizenship.

Good luck
//
ps: I am not a lawyer nor a tax consultant. And I am not planning to be
one. Consulting a CPA or an immigration attorney is a good idea.