FOREIGN INCOME EXCLUSION

[jlc_rosi]

I am an American Citizen married to a non US citizen-non resident, working and living outside the US, filing jointly.
 I did receive foreign income tax exclusion.
 However when trying to advance with my husbands information here on line, inside "to qualify to exclude foreign income from US tax", it is impossible to advance in the system for his exclusion. It says "...husband is a non resident alien he must file form 1040NR unless married to US Citizen. HE IS MARRIED TO US CITIZEN!! Where do I go from here?

[bine22 · Accepted solution]

A nonresident alien cannot file a joint return. If you want to file jointly, you need to treat him as a resident alien. The first year doing that you need to attach a statement to your return making this choice. That means, you cannot efile. 

However, once you make the choice to treat him as resident alien, choose "resident alien" when filling out the info for form 2555

[abanderson]

Hi, just curious, how can you " treat him as a resident alien"? Turbotax asked in the system if the spouse is a NRA or RA...and if the yes is NRA, the spouse is not qualified for a foreign income exclusion. Thank you for your help in advance. 

[DavidS127]

You treat your nonresident spouse as a resident for tax purposes by making the choice described in IRS Publication 519, U.S. Tax Guide for Aliens, designating your spouse as a resident in TurboTax, and attaching a required statement to your mailed (not-efiled) tax return.

Here is some of the Publication 519 text describing the option to treat your nonresident spouse as a U.S. resident for tax purposes:

"If, at the end of your tax year, you are married and one spouse is a U.S. citizen or a resident alien and the other spouse is a nonresident alien, you can choose to treat the nonresident spouse as a U.S. resident. This includes situations in which one spouse is a nonresident alien at the beginning of the tax year, but a resident alien at the end of the year, and the other spouse is a nonresident alien at the end of the year."

To make the choice, attach a statement, signed by both spouses, to your joint return for the first tax year for which the choice applies. It should contain the following information.

• A declaration that one spouse was a nonresident alien and the other spouse a U.S. citizen or resident alien on the last day of your tax year, and that you choose to be treated as U.S. residents for the entire tax year.

• The name, address, and identification number of each spouse. (If one spouse died, include the name and address of the person making the choice for the deceased spouse.)

@abanderson