Oh Ma Gah. I’ve Never Been So Confused by Taxes Before.

Oh Ma Gah. I’ve Never Been So Confused by Taxes Before.

March 10th, 2010 @ 2:48 pm by Mrs. D'orsay
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I spoke with our accountant today, and thankfully Mr. D won’t have to pay double taxes. Since he will remain a citizen of Her Majesty, and not the US he will file his taxes in the UK.

Thankfully, the US and the UK have laws of reciprocity, essentially meaning that we don’t have to be taxed twice, though there are several countries where that isn’t the case. Mr. D will remain in the pension system for the UK, and pay UK taxes - which makes sense considering all his income is British. Whereas I will pay US taxes, as usual. He *could* choose to pay US taxes instead of UK, but that appears to make the process 369857698456 more complicated. If he has a US job, with US employers it could make more sense for him to file in the US. Since he doesn’t, we’ll be filing with two countries this year. Or rather, we’ll only be taxed once in each country.

I also worried that we would not count as a married couple this year for tax purposes. I thought this was a bit bogus since the US wouldn’t allow Mr. D to work here, AND they wanted to shirk my marital tax benefit? Jerks.

When you fill out a W-4 it notes that if you are married to a non-resident alien you should file as single. My accountant says not to worry, if you’re married - you’re married. Whoopee! Our marriage is recognized! Which I can at least say is true of my LGBT friends in DC… but sadly, not too many other places. Le sigh.

Lesson of the day? Sometimes it’s a good idea to trust an expert and not *gasp* Google.

Are you experiencing any difficult tax situations now that you’re married?

Tags: baltimore, legal |

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18 Responses to “Oh Ma Gah. I’ve Never Been So Confused by Taxes Before.”

Bee

Mrs. Star (message) 2,057 posts, Buzzing bee

Ugh. Your tax situation sounds as complicated as ours. Glad you got it worked out!

3/10/10 @ 2:54 pm (reply)

Member

mander411 (message) 735 posts, Busy bee

Since we get married this year we don’t file as married until 2011 when we do our 2010 taxes. But since my FH is working 2 FT jobs and I work my own FT job we did already talk to someone about the implications of not being taxed enough by either of his jobs soley and then adding on the marriage issue. He said we would likely end up owing like 4k - so FH is getting extra money taken out of each check from one of his jobs to keep that from happening. I would not want to write that check if we owed $!

3/10/10 @ 2:58 pm (reply)

Member

historienne (message) 372 posts, Helper bee

Can I just say, I’ve been dealing with this EXACT same question. Down to the British husband. It makes my head spin, and I’ve been putting it off until my husband gets his SSN (he got his green care, but not till 2010), but I know I need to deal with it soon and I dread it!

3/10/10 @ 3:00 pm (reply)

Member

FinallyGettingMarried (message) 425 posts, Helper bee

I do international taxation for a living so if you have any questions feel free to bounce it off me. There are not a lot of “good” international/local CPA firms so you have to be careful. The safest is to go with a big 4, otherwise, make sure you go to a reputable firm who specializes in international taxataion to minimize your global taxes. If your hubby has stock options, or if he’s not a US citizen yet, make sure he does all the family wealth planning BEFORE he becomes a citizen of the USA.

Good luck

3/10/10 @ 3:09 pm (reply)

Bee

Mrs. D'orsay (message) 2,272 posts, Buzzing bee

@historienne: I am so sorry. It’s very frustrating and I’m very glad we finally spoke to an accountant about it. Mr.D spoke to his business accountant in England, and I spoke to my accountant here and our accountants are working it out together. I just have to provide paperwork.

3/10/10 @ 3:11 pm (reply)

Member

ejs4y8 (message) 14,581 posts, Bee Keeper

We did ours Monday night. Turns out military people get free tax filing. Yay! So we filled it out with him. It wasn’t so bad–I really like doing it all electronically. Mine were SO simple last year…i was still technically a “dependent” and single. This year we’re married and there is a house, investments, money in the bank, one of us was military in 2009k one of us wasn’t…it didn’t take long though. But it was a pain.

3/10/10 @ 3:13 pm (reply)

Member

kayakgirl73 (message) 2,124 posts, Buzzing bee

I hate Taxes more than usual at the moment. Our problem is we got married in 2009. I moved from Maryland to Virginia right after the wedding. So I was never married as a Maryland resident, but married only in VA. Trying to figure out what we can file joint or if everything has to be filed married filing separtly. My husband was never a MD resident. Yuck. Turbo tax is just confusing us. I hope we don’t have to hire a CPA.

3/10/10 @ 3:14 pm (reply)

Member

ggsb (message) 1,245 posts, Bumble bee

Our taxes are a big enough pain, but I can’t imagine what a mess it would be with two countries involved! We are being hit with the “marriage penalty” big time…and it makes me so angry when I think about it!

3/10/10 @ 3:18 pm (reply)

Bee

Mrs. D'orsay (message) 2,272 posts, Buzzing bee

@kayakgirl73: I really can’t begin to tell you how happy I am that we did. I’m usually ACAP (as cheap as possible) and Mr.D is AHFAP (as hassle free as possible). I’m really, really glad we went AHFAP on this. If you were in MD I’d refer you to our CPA Good luck!

3/10/10 @ 3:20 pm (reply)

10.

Bee

Miss Pug (message) 3,753 posts, Honey bee

we’re totally going with an accountant this year. i can barely do my own taxes, i think i’d rip my hair out with the big change next year.

3/10/10 @ 4:04 pm (reply)

11.

Member

amariem25 (message) 3,733 posts, Sugar bee

my husband told me it would be better off for us to file singly than as a married couple. Do you think this is true?

3/10/10 @ 4:52 pm (reply)

12.

Bee

Miss Cardigan (message) 8,645 posts, Bee Keeper

Taxes confuse me completely. Luckily, my fiance is getting his masters in accounting, so I won’t have to worry about it!!!

3/10/10 @ 5:37 pm (reply)

13.

Bee

Miss Hamster (message) 4,045 posts, Honey bee

Ugh, that is confusing! We just go to an accountant as well and let them handle it.

3/10/10 @ 6:24 pm (reply)

14.

Bee

Mrs. Swan (message) 1,046 posts, Bumble bee

Wow! What a mess. I’m glad you’ve been able to figure all of this out.

3/10/10 @ 9:53 pm (reply)

15.

Member

infamia (message) 169 posts, Blushing bee

I am in the same boat… my hubby is American filing in the US, I am German filing in Germany - it is a HUGE mess! Our marriage is recognized in the US but not in Germany, I am totally confused right now and will definitely look for a professional to help us out!

3/11/10 @ 4:22 am (reply)

16.

Member

mrspaetz (message) 3,805 posts, Honey bee

i hate the US immigration process and all the complications! urgh!!!

3/11/10 @ 11:45 am (reply)

17.

Member

skibobrown (message) 1,902 posts, Buzzing bee

Gosh. Good luck! Your taxes sound even more confusing than ours. (We lived in 2 states this year, had 4 different jobs between the 2 of us, and I currently am not eligible to have taxes withheld, so I have to file quarterly. Ugh.)

3/11/10 @ 11:48 am (reply)

18.

Member

tyelperion (message) 26 posts, Newbee

Well, at least if Mr D becomes a US resident with a job and income in the US, and is no longer resident in the UK, he’ll be able to stop filing in the UK and just file one tax return in the US.

On the other hand…the UK bases taxation on residency, and the US bases it on nationality. So, if you guys move back to the UK, and Mrs D becomes a UK resident with a UK income - she still has to keep filing in the States!! I have never, in my whole life had a job in the USA - but because of that annoying passport, I still have to pay full UK taxes, and pay a US accountant to to my US taxes every year AS WELL - even though I don’t earn a penny in the US (or use any of the services). It drives me nuts!! That handy foreign earned income exemption only goes up to $80k which goes a lot farther in the States than it does here - as soon as our combined salaries hit £40k I will have to pay taxes in both the US and the UK.

3/11/10 @ 1:26 pm (reply)