Reporting foreign income of Non-Resident Alien spouse for American Opportunity Tax Credit

[emmillinnee 9]

I am married to a Spanish citizen. We are still waiting for his interview date for the I-130 visa. I (US citizen) am working on filing taxes. I plan to attach from W-7 to get him a ITIN so that we can file as married, filing jointly. We want to claim the American Opportunity Tax credit because he took online classes in 2021 at a U.S. institution. 

 

My question is, where do I put his foreign earned income (only about $7000 USD if you convert them from EUR) on form 1040? 

[JeanneAdil 6,399]

u file form 2555 for his foreign income (which will be excluded)  $108,700 

since Spain has a tax treaty with the US in following chart

 

https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z

S

Slovak Republic
Slovenia
South Africa
Spain
Sri Lanka
Sweden
Switzerland

follow the instructions on the form and it will tell u if u need to fill out Schedule B which is for Interest,  etc

[Wuozopo 4,291]

2 hours ago, emmillinnee said:

I am married to a Spanish citizen. We are still waiting for his interview date for the I-130 visa. I (US citizen) am working on filing taxes. I plan to attach from W-7 to get him a ITIN so that we can file as married, filing jointly. We want to claim the American Opportunity Tax credit because he took online classes in 2021 at a U.S. institution. 

 

My question is, where do I put his foreign earned income (only about $7000 USD if you convert them from EUR) on form 1040? 

What software are you using?  They vary on where they collect the foreign income information. TurboTax asks under Less Common Income > Foreign income.

[emmillinnee 9]

1 hour ago, Wuozopo said:

What software are you using?  They vary on where they collect the foreign income information. TurboTax asks under Less Common Income > Foreign income.

I'm using free fillable forms. It's just the IRS forms themselves 

[emmillinnee 9]

4 hours ago, JeanneAdil said:

u file form 2555 for his foreign income (which will be excluded)  $108,700 

since Spain has a tax treaty with the US in following chart

 

https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z

S

Slovak Republic
Slovenia
South Africa
Spain
Sri Lanka
Sweden
Switzerland

follow the instructions on the form and it will tell u if u need to fill out Schedule B which is for Interest,  etc

Okay so I put my income + my husband's (Spanish citizen) foreign income in line 1 on 1040. Then fill out form 2555 with my husband's foreign income. Then it gets subtracted out of our taxable income on line 15 form 1040. The part I'm still confused about is putting my husband's income in line 1 on 1040 because he doesn't have a W-2...but if I don't add his income to line 1, it only subtracts it (online 8 as 'other income' from schedule 1 line 10) from our taxable income. 

 

I hope that makes sense...

[Wuozopo 4,291]

10 hours ago, emmillinnee said:

I'm using free fillable forms. It's just the IRS forms themselves 

His wage income is added to yours-as you stated —Line 1. You don”t have to have a W2. You are being honest and reporting it and Line 1 is for wages, including foreign. The thing you have to watch out for is that taxes are not figured the traditional way when you use form 2555. 
 

Use the instructions https://www.irs.gov/pub/irs-pdf/i1040gi.pdf

See  page 32, 34 for your Line16 tax instructions. Note the last thing on page 34 says:

Foreign Earned Income Tax Worksheet. If you claimed the foreign earned income exclusion, housing exclusion, or housing deduction on Form 2555, you must figure your tax using the Foreign Earned Income Tax Worksheet.

 

So use that Foreign Earned Income worksheet found on page 35 of the instructions to get your 1040 Line 16 amount. If you had dividends or a Schedule D in you return be sure to read the smaller italic type below the worksheet. 

[Gabriel5454 19]

Don't forget to attach a statement that you wish to treat your husband as a resident for tax purposes (which I'm assuming you are since you are declaring his foreign income).