L1 Visa W-4 FORM. Question about "Married filing jointly" option

[real4uk]

Hello. I'm going to relocate to the US with my wife soon by L1B(wife has L-2) visa, and I have a question about the W-4 form.

I need to complete it by the first working day in the US.

There is a section in the W-4 form where I need to mention my status (single, married, head of household).

Can I choose the "Married filing jointly or Qualifying widow(er)" option in my case?

If not, what should I choose?

I read a lot of resources/forums, and there are a lot of opinions about that.

Could you please help me with that?

I really appreciate any help you can provide.

[pk]

@real4uk , welcome to the USA  and hoping this will be a great  foreign assignment for you ( as mine was assigned to UK  35 years ago ).

For your W-4  , your filing status is Married Filing Joint ( MFJ ) -- this gives you the best tax outcome , generally.   My assumptions here are : (a) you and your wife agree to file together and therefore are subject to your world income ( including her  world income ) once you become Resident for Tax purposes --- pass the  Substantial Presence  Test ;  (b) you are both citizen of another country ( UK ?);  (c) You have US employment and  your wife does not/will not have  US income ( because she has a dependent visa not good for employment in the USA); (d) you both have a tax id valid in the USA  ( you with SSN and she with SSN or ITIN )

Is there more I can do for you ? 

[real4uk]

@pk , Thank you for the answer.

We are relocating to the US next week. 

We are both citizens from another country.

As far as I know, to become a  US resident, we have to live at least 183 days in the US.  

However, until we are not residents, can I choose MFJ status in W-4 form?

My wife is going to work after she gets EAD.

[pk]

@real4uk , sorry -- I was not clear --- you can always  choose  MFJ ( on the W-4 because this affects  only the withholding  amounts  per pay period).  When you finally file  during 2022  ( tax filing/ paying day is April 15th. ), only then  you make a final decision  and only for that tax year ( same as calendar year ).

Is there more  I can do for you ?

[real4uk]

@pk Thank you again!

For example:

1. We arrive in the US

2. I fill out the W-4 form and set status as MFJ.

3. Before 15 April, we become US residents, and it means that I do not need to pay any additional taxes, right ?

 
But in case if we arrive in the US, for example, 25 December, fill out the W-4 form with status MFJ and not become US citizens before 15 April, it means that I need to pay additional taxes as for a “Single or Married filing separately”. Is it correct ?

[pk · Accepted solution]

@real4uk , sorry for the confusion :

(a) your filling out of the form W-4 is only good  for your employer to withhold taxes on behalf of the Federal and the State.  They do this by  computing  taxes due on the  income earned till date  at that employer and is based on "estimated deductions" that you probably will claim.  Many people  fill out W-4  as single ( when they actually married  )-- this way more of their  earnings are held back as  "prepaid" or PAYE taxes.  The advanatge of this is that when they finally file their returns   they get a larger amount back  -- it is their money that was  loaned to the govt.  at zero interest.  Some  use this as a forced savings or other reasons.

(b)  when you file your return , it is the real  taxes computed, adjusted against the withholding and  excess returned to the taxpayer.  It is not a PAYE system in that respect and unlike the UK , you have to file each year  unless your income is below the filing requirement ( in the region of 10-12 K  or thereabouts, depending on your filing status and number of dependents etc. )

(c) if you enter the USA on December 25th, you may not have any earnings in the USA for the tax year 2021 and thus you will not need to file a return on or before April 2022.  In such a case you may be better served by staying out of the USA till the 1st. Jan2022 -- taxes  would be simpler ( in the USA ).  UK also may not tax the  first quarter of 2022  ( have to look up the  USA-UK tax treaty to be sure -- some countries do claim this  period though ).

Hope this clarifies  the situation ( difference between the UK and the US system ).

[real4uk]

Thank you very much for your help and time @pk .

Everything is clear now.

[aatifk]

I would chime in here just a little because your situation is quite similar to what mine was in September last year (I arrived in the US end of September 2021, L1B visa with wife on L2). Wife got her EAD just this past month (July).

In my 2021 tax return, I was a nonresident alien because I did not meet the substantial presence test (which I assume you won't meet either given the time that you're arriving here). Therefore, my return was filed as "married filing separately" because my wife didn't get an SSN issued at that time either (the SSA is ridiculously backlogged and slow because of COVID). Knowing that that was going to be my filing status, that's what I indicated on my W-4 as well. Based on what the tax accountant that I consulted with told me, it didn't matter because a nonresident alien cannot claim deductions, only child tax credits. And so if that's the scenario that you think is going to play out for you as well, I hope knowing this will help.

Given our relatively similar situations, I'm happy to try and help answer any other questions that you might have as well. But yes, W-4 only affects your withholdings, not the actual tax bill which will come later when you file your return.