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February 16, 2016 - Phil Hodgen

Filing Form 1040 With a Nonresident Alien Spouse Isn’t Easy

I received an email from B.W., who cogently expressed his frustration with filing Form 1040 while married to a nonresident alien. The TL;DR is “Paper works, e-file doesn’t”. B.W. said I could share his email with you.

Hello Phil:

I share your frustration with the way the IRS deals with expatriates. (I don’t mean real expatriates – just ones living somewhere else.)

There is an issue with unjustifiable discrimination. See if you can spot the distinction between the following two situations:

  1. Expatriate taxpayer has Non Resident Alien spouse without a US ID number, who is not claimed for personal exemptions, is not present for any deductions, and in fact is not mentioned anywhere in the 1040 return (Other than being referred to in the married, filing separate spot.)
  2. Expatriate taxpayer has Non Resident Alien spouse without a US ID number, who is not claimed for personal exemptions, is not present for any deductions, and in fact is not mentioned anywhere in the 1040 return (Other than being referred to in the married, filing separate spot.)

Don’t the see the difference? Well the IRS does. The first taxpayer efiled and the second one paper filed. The first taxpayer’s return was rejected, but the second return was accepted.

For no reason that anyone I have spoken to at the IRS can find, the efile return must be rejected because of the (irrelevant) NRA spouse. However, it was stressed to me that an irrelevant NRA spouse on a paper return is welcomed.

This is not particularly trivial because typical expatriate 1040 returns easily run 100 pages and more. The US has discontinued accepting registered mail from outside the country, so for safe delivery, the taxpayer must use international courier (expensive).

Not only that, but the taxpayer must also be aware that there are only five IRS locations in the entire country that accept courier deliveries. Anything sent by FedEx or UPS or anyone else to any of the countless thousands of other IRS offices will be rejected. (Failure to file penalties applicable.)

It’s often difficult enough living and working outside the US without being reminded that your government hates you for daring to be away, and will create every inconvenience possible to demonstrate their resentment.

It’s interesting though, because this kind of obvious discrimination by a company, or even another government agency, would have the ACLU on their doorsteps.

I have written to the IRS Efile Consultation committee about this, and even directly to one of the committee members. Nobody cares at all.

This makes me sad.

B.W.

(A possible solution may be to obtain a ITIN for the spouse. Most non US spouses would be delighted to provide all their personal information to Uncle Sam for no determinable reason. And obtaining a number without a corresponding tax return is generally not possible. And even if a number could be obtained, because it will never be used, it will expire in a few years, requiring a repeat of the whole process. Possibly not a solution.)

Annoyances like this drive Americans to expatriation.

Expatriation