For 2019, I am trying to figure out whether I am REQUIRED to file Form 8958 (Allocation of Tax Amounts Between Certain Individuals in Community Property States)
Per page 8 of IRS Publication 555 reads “if you are a US citizen or resident alien and don’t choose to treat your nonresident alien spouse as a US resident for tax purposes, treat your community income as explained under Spouses living apart all year. However, you don’t have to meet the four conditions discussed there.”
Spouses living apart all year. If you are married at any time during the calendar year, special rules apply for reporting certain community income. You must meet all the following conditions for these special rules to apply.
1.You and your spouse lived apart all year.
2.You and your spouse didn't file a joint return for a tax year beginning or ending in the calendar year.
3.You and/or your spouse had earned income for the calendar year that is community income.
4.You and your spouse haven't transferred, directly or indirectly, any of the earned income in condition (3) above between yourselves before the end of the year. Don't take into account transfers satisfying child sup-port obligations or transfers of very small amounts or value.
We actually meet all of the conditions despite not being required to.
In reference to an example, the page goes on to state “But because they meet the four conditions listed earlier under Spouses living apart all year, they must disregard community property law in reporting all their income (except the interest income) from community property. They each report on their returns only their own earnings and other income, and their share of the interest income from community property.”
Based on this, in our case, there would be no community income, including income from community property. But the instructions do not explicitly state whether we need to fill out the form and make the allocation of my income to myself and my wife’s to her OR just not submit the form! What to do?
Also, on my Form 1040, in the box requiring spouse’s SSN, what do I do? Write in NRA (non -resident alien)? Apply for a ITIN (tax identification number) using Form W-7 even though my spouse does not need one? What to do?
Reference: https://www.irs.gov/publications/p555
