Opinions please: Best Tax Prep Software for a US Citizen living as a permanent reside

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Opinions please: Best Tax Prep Software for a US Citizen living as a permanent reside


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Old 5th January 2012, 02:08 PM
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Default Opinions please: Best Tax Prep Software for a US Citizen living as a permanent reside

Hello,

I am new to this forum and this is my first post. I am very thankful to have this forum as a resource. I’m a US citizen married to a Canadian. We recently moved to Canada from the US.

What is everyone’s opinion was on what is the best Tax Preparation Software for a US citizen living in Canada? I cannot afford an accountant or a tax attorney. I don’t own a company or have any complex investments in Canada. I am looking for an easy to use application that will let me e-file from a foreign address. I work in Canada and have a couple bank accounts in Canada I opened jointly with my spouse (over $10K).


My Spouse also opened a RESP – value under $10K for 2011 for my son (Age 3 born in Canada) .. my name is not on the RESP. We have a 3 month old daughter (also born in Canada). I don’t have a TIN for either child in the US yet. I plan on making them dual citizenship official sometime in the near future.

One other question: My spouse worked in the USA on a TN1 visa (nursing) and we filed our US taxes as married filing jointly but my spouse doesn’t want to file taxes/fbar in the US now that we are living in Canada. My Spouse never became a US citizen while we lived in the US and never had a Green Card but does have a TIN # in the US. Is she still required to file in the US or can I just submit my taxes as Married filing separately and indicate my wife is a non – resident alien?

Any information and/or advise on these questions would be greatly appreciated.

Thanks,

uconnhusky

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Old 5th January 2012, 02:17 PM
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I would be curious to hear what suggestions people have as well. The tax preparer (from my hometown in the US) who I have gone to for 7-8 years is useless (I had to talk him through the Schedule B and FBAR, the latter he didn't seem to have a clue about). I may as well do the damned returns myself.

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Old 5th January 2012, 02:24 PM
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From what I understand there are many free programs if your income is below a certain threshold which I believe is about $55,000. I think you can find them off the irs site.

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Old 5th January 2012, 05:13 PM
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Quote:
Originally Posted by uconnhusky View Post
Hello,

I am new to this forum and this is my first post. I am very thankful to have this forum as a resource. I’m a US citizen married to a Canadian. We recently moved to Canada from the US.

What is everyone’s opinion was on what is the best Tax Preparation Software for a US citizen living in Canada? I cannot afford an accountant or a tax attorney. I don’t own a company or have any complex investments in Canada. I am looking for an easy to use application that will let me e-file from a foreign address. I work in Canada and have a couple bank accounts in Canada I opened jointly with my spouse (over $10K).
The "best" tax preparation software depends on your precise circumstances, but any of the standard programs should do. Most tax prep software includes all the forms needed for filing from outside the US, including forms 2555 and 1116.

E-filing is the trick. Last year, only a limited number of the free e-filing sites could accept a "foreign" address, and all of those sites had age restrictions that eliminated the possibility for people in certain age ranges.

This year, the IRS section on e-filing (which includes all the online free e-filing sites) doesn't open until January 16th, so you'll have to wait until then. But the good news is that the free e-filing sites actually do the tax preparation for you - so you don't have to buy a tax preparation software. Wait until the 16th and then see what the IRS has to offer this year.


Quote:
My Spouse also opened a RESP – value under $10K for 2011 for my son (Age 3 born in Canada) .. my name is not on the RESP. We have a 3 month old daughter (also born in Canada). I don’t have a TIN for either child in the US yet. I plan on making them dual citizenship official sometime in the near future.
You only need the TIN for your kids if you're taking them as exemptions, and chances are you probably won't need to do so for purposes of filing your US tax returns. If your name isn't on the RESP I wouldn't worry about filing anything on that.

Quote:
One other question: My spouse worked in the USA on a TN1 visa (nursing) and we filed our US taxes as married filing jointly but my spouse doesn’t want to file taxes/fbar in the US now that we are living in Canada. My Spouse never became a US citizen while we lived in the US and never had a Green Card but does have a TIN # in the US. Is she still required to file in the US or can I just submit my taxes as Married filing separately and indicate my wife is a non – resident alien?
Just file as married filing separately and where it asks for your wife's SS number, just fill in "NRA." Just be aware that, in some tax preparation programs, this will mean that you can't e-file. It will just keep coming back as an "error" - but if worst comes to worst, just print what you have, stick a stamp on it and mail in the returns.

One small caveat - if you're planning on taking the FEIE (i.e. the earned income exemption), you have to have been physically outside the US for a full 12 months before you can file and take the exclusion. If you moved to Canada during 2011, you may have to wait to file until you pass your first anniversary date for living in Canada. (And if you moved in the last half of 2011, you may need to request an extension past the usual June 15th filing deadline - you get an extra two months when you live outside the US!)

While waiting for the e-filing section of the IRS website to go live, you might want to download Publication 54 to get a feel for some of the special rules that apply when you file from outside the US.
Cheers,
Bev

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Old 5th January 2012, 06:54 PM
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Thanks for the great information Bev!

I will check the IRS site for the e-file option after Jan 16th and look for a package that includes forms 2555 and 1116. Hopefully one of the participating companies will accept both the foreign address as well as the “NRA” where it asks for my wife’s SSN and still e-file it. If not..I will just have to snail mail it. I am also reading IRS Publication 54 as suggested.


Any other expats use this IRS e-file option? What was your experience?

Which company accepted foreign addresses?


OK I'll stop with all the questions...

Thanks again,

Uconnhusky

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Old 5th January 2012, 07:30 PM
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Last year, I used Turbo Tax 2010 for 2010 and used older versions for backfiling. Although it was my first time with the software, it was relatively easy to use and did most tax forms. It did not do the PFIC form (8621), so I did that manually. It does do FBARs, but those have to be printed and sent separately. I think the cost was around $50-75 depending on edition of Turbo Tax.

The free programs seemed to be a mixed bag, did not do more complicated returns, especially some of the foreign tax credit forms, AMT etc etc. I skimmed them, then decided against them.

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