Can a J2 holder (with SSN) apply ITIN number for their child for claiming a credit for child care expenses?

[okita273]

Hi, I am a J2 visa holder (entered US on April 2021). My husband was J1 (entered US on January 2021) which is exempt income from US Federal tax (under tax treaty benefit). Therefore, as I understand, my husband cannot apply IRS Individual Taxpayer Identification Number (ITIN) for my child for tax return purpose, as he did not need to pay Federal income tax.

 Recently, I got a job and I did pay U.S federal income taxes (through W-2 form). So I wonder if I can apply ITIN number for my child for tax reduction purposes?

And when filing a tax return, do we need to file separately or jointly? Thank you!

[Anonymous_]

I will page Champ @pk. Check back here later.

[Critter-3]

Basic rules for the form 2441 ...

You must have taxable earned income to use the credit  AND  you must file a joint return to get the credit.  If you have no taxable income and no tax liability the credit is useless  AND the MFS status doesn't allow the credit at all.  And if you file a joint return both parents must have taxable earned income to use the credit.

[okita273]

Thank you! We actually file tax separately so as you mention, I cannot apply ITIN for my child. 

[Critter-3]

Ok ... you are messing things up ... if you want to claim a child on the return they need either a SS# or an ITIN.  You must apply for the ITIN by sending a tax return with the W-7 application ... if you don't you will lose any credit for the child completely.

[okita273]

Yes, I understand that I need to apply a ITIN (form W7) for my baby when filing tax return. The things is, because I file tax return separately with my husband (as I husband don’t need to), so that mean I cannot file W7 for ITIN. Is that’s right? 
Another question is, if my baby doesn’t have a ITIN, can I claim Dependent FSA for daycare tuition fee? 

[Critter-3]

You are confusing me ... if you are filing a return and claiming the child you MUST file it attached to a W-7 to get an ITIN.  If you are not filing a return then you have no reason to get the ITIN. 

As to the FSA ... to use that program you must have a qualifying child that you claim on a return which again means you need the ITIN. If you put money in an FSA and then don't file a return OR file separately then the money you put into the FSA will simply be added back into your income on the tax return which negates the entire reason for the progam.  

[okita273]

I am sorry for making you confused. I am preparing file tax return (my income did pay federal tax). But as I am j2 visa, so I wonder if I can file tax return with applying w7 for my baby itin? Because I will file tax return separately with my spouse (who is J1 visa and don’t need to file tax return as his income was exempted from federal tax). 
As I know FSA is non rollover, and if my baby don’t have itin so that’s mean I cannot claim for my baby childcare, so all money on my dependent FSA account will loose or be refunded to my account?

[pk]

@okita273 , having gone through the discussion here-in, I would first like to get some more information to understand the situation:

(a) which country are you from ( both of you from same country or ? )

(b) Was the child born here in USA ?

( c) Do you ( the parents ) each have SSN as part of your employment here in the USA?

(d) The husband ( J-1) was admitted as  what  ( Teacher / Trainee / Student / Researcher etc. etc. )

(e)  Is he exempt ( from counting days present)? and how long is the contract for ?

(f) Who is paying the Husband ( if not a student  )?  And how is it being reported  W-2  or 1042-S ?

  And some comments --- 1.  Not being taxed on income per treaty  does not mean  not having to file a return ( whether 1040 or 1040-NR );  2. Whether jointly filed ( MFJ ) or Separately ( MFS), there interactions between the filings i.e. for many purposes , one affects the other.

Please answer my questions and I will circle back and help

@Critter-3 

[okita273]

@pk Thank you for your help. Here is my answer.

a. We both from vietnam. However, we did live in South Korea for 7 years before moving to US, and paid income tax in South Korea. Therefore, we was considered as South Korea resident, so my husband under j1 visa don’t need to pay federal tax for 5 years, as he is visiting fellow at a national institute in US. When he came here, immigration staff in his institute help him to file W-8Ben so his income was exempted from federal tax. That’s why he did not file tax return.

b. My baby was born outside US.

c. My husband is j1 visa so he got ssn. I am j2 dependent, so I applied for EAD and got ssn. Then I got this job, received w-2.

d. My husband is visiting fellow in a National institute in U.S.

e. He got ds2019 from sponsor institute and they will renew each year. And he will have maxium 5 years for his position.

f. A national institute pay for him. His fund is from US government. I don’t know but he said he received full salary without any reductions, so he don’t need to file tax return. He only file for state tax. May be he is wrong?

and

1&2. I don’t know if we can file jointly or separately. Because we a nonresident. So please help. It’s too complicated. :(

thank you!