Taxes for permanent resident MFS

J

Jerbark

Registered Users (C)
I'm a US citizen. Husband is a permanent resident (country of origin is the UK). Because he's married to me, if we file our income taxes jointly, we have to include all of our "world wide" income i.e. any income he earns from assets in the UK. Because he's a permanent resident, he'd still have to report any income he has from other countries on his US return, right? If we file Married Filing Separately, would I have to report any income from the UK on my tax return?

Thanks!
 
US citizens and permanent residents have to report worldwide income on their US tax returns, whether married or single, jointly or separately.

If you file as married separately, you have to report your own foreign income on your return, but not his foreign income. On his return he would report his foreign income and not yours. All in addition to US income, of course.
 
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Advantages of NOT being a citizen? In his case, not much I can think of except these few (for others the pros and cons are different because of their original country's rules regarding dual citizenship):

- If he leaves the US and officially surrenders his green card, he can escape the ongoing worldwide taxation that would apply if he became a US citizen*. If the departure is before 8 years** as an LPR, he would also escape the special expatriation tax (which may apply to those whose assets total over $600K of capital gains).

- He doesn't have to serve jury duty (except maybe in New York, where I've heard they've started requiring permanent residents to serve)

- It is not safe to be American when traveling certain parts of the world (although if he travels with you he might be perceived as American anyway).


*for very wealthy permanent residents (I think over $2M net worth) who leave without becoming citizens, they still continue to tax them for some number of years after they've left the US. Of course, enforcing it can be difficult or impossible if the person has no US-based assets and doesn't visit the US.

**for the purpose of this tax they count a single day in a calendar year as a whole year, so it doesn't mean 8 full years.
 
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One more:

- It is possible that the UK will disallow him from holding political office there if he also has US citizenship (not sure if the UK rules are like that, but some countries have that restriction, so if he's interested in politics he'll have to research those rules for the level of office he wants to serve).
 
Jacolantern, Thanks for the speedy reply. Are you a tax attorney or CPA? If not, can you recommend someone who specilized in international taxation issues, specifically between the US and UK? If we're not allowed to refer on this webiste, you can email me privately at jerolyn@dolanweb.com

Again, thanks for your help.
 
No, as clearly stated in my signature I am not an attorney. I am also not an accountant and don't know of any that specialize in UK-US taxation. Try asking for one on a tax forum and you might get some recommendations. And I would advise you to edit your message to remove your email address ASAP before too many spambots pick it up.
 
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