That's a really good point I hadn't considered. We're planning to file jointly going forward, but should we also be updating our status with Social Security, health insurance, etc.? Are there any benefits we might lose by being considered married?

Yes, you should absolutely update your status with all agencies. Being inconsistent is a red flag. As for benefits you might lose - some income-based programs phase out at higher income levels for married couples compared to singles, and there can be a "marriage penalty" in certain tax brackets where two high earners pay more jointly than they would separately. Some people find that student loan payments increase when filing jointly if one partner has a much higher income. You might want to run calculations both ways (MFJ vs MFS) to see what works best, though in most cases MFJ provides better tax benefits.

I went through this in 2023. We claimed common law married status in Iowa and got audited. The key was having consistent documentation - joint bank accounts from when we started considering ourselves married, beneficiary designations, insurance policies listing each other as spouses, and affidavits from family and friends confirming they knew us as married.

That's really helpful to know. Did you need to get a lawyer involved during the audit process? And how far back did they want documentation? I'm just trying to understand what we might be getting ourselves into if we make this change.

Unfortunately, IRS Direct File still doesn't support 1040-NR for the 2025 filing season. It's limited to fairly simple 1040 returns for residents. Non-resident returns typically have more specialized requirements like treaty provisions and different deduction rules that aren't part of the Direct File system yet.

That's disappointing! I was hoping they'd expand it to include non-resident forms since they're rolling it out to more states. Thanks for confirming though - saves me time trying to figure it out.

I can't speak directly to their support for non-resident specific issues, but my colleague who used OLT said their email support was responsive (24-48 hours) when he had a question about reporting his foreign pension. He said they have a knowledge base specifically for non-resident issues that was helpful too. Definitely not as comprehensive as paid services, but adequate for straightforward situations.

Thanks for the info! That's actually better than I expected. I might try them next year if my situation doesn't change much. $180 vs free is a big difference for essentially the same outcome!

Would this be the same for a situation where the insurance company sent a check for property damage rather than lost rent? I received a check for roof damage but it was made out to both me and my mortgage company.

No, that's actually quite different. Insurance payments for property damage (like your roof) are generally not taxable income - they're considered reimbursement for capital expenses. However, if the insurance payment exceeds your basis in the damaged property component, you might have to recognize gain. The situation gets more complex when the check includes your mortgage company. Typically, mortgage companies are included on insurance checks for significant property damage to ensure the repairs are actually completed. This doesn't change the tax treatment - it's still not income - but you'll need to work with your mortgage company to get the funds released for the actual repairs.

Wait so if the 1099-NEC is for lost rental income is it considered passive income? I thought anything on a 1099-NEC is automatically considered self-employment income subject to SE tax?

That's a really common misconception! The 1099-NEC form itself doesn't determine whether income is subject to self-employment tax - the nature of the income does. In this case, despite being on a 1099-NEC, the payment is essentially replacement rental income, which is generally considered passive income reported on Schedule E and not subject to self-employment tax. The insurance company probably issued a 1099-NEC because they didn't have a more appropriate form for this type of payment, but that doesn't change its fundamental nature as replacement for rental income. When you report it on Schedule E along with your other rental activities, you're correctly characterizing it based on what it actually represents rather than just the form it came on.

Thanks for bringing this up! I actually wasn't sure about Form 8833. Does everyone claiming treaty benefits need to file this form? The treaty amount isn't huge (around $6,500 total income with $1,950 withheld), so I wasn't sure if there's some minimum threshold.

Technically, not everyone needs to file Form 8833. There are exceptions based on the type of income and amount. Generally, if your treaty-based position is already disclosed on a W-8BEN form you submitted to the payer (which would normally be the case for standard treaty reductions on things like royalties, dividends, etc.), you might be exempt from filing Form 8833. However, there are specific situations that always require Form 8833 regardless of amount, such as certain business profits claims or if you're taking a position that's contrary to a U.S. regulation. In your case with $6,500 income and standard treaty withholding reduction, you might be exempt, but most tax professionals recommend filing it anyway to be safe. The penalties for not filing when required can be quite steep ($1,000 per position), so the safe approach is to include it.

This is actually incorrect information. The June 15th deadline is for US citizens and resident aliens living abroad, not for nonresident aliens. The 1040-NR is generally due on April 15th for most filers (or the next business day if it falls on a weekend or holiday).

You're right, I mixed up the rules. Thanks for the correction! Nonresident aliens filing Form 1040-NR generally need to file by April 15th (or the next business day if it falls on a weekend or holiday) for the previous tax year. The June 15th deadline applies to U.S. citizens and resident aliens who live and work outside the U.S. and Puerto Rico. The important point still stands though - even if you missed the deadline, you can still file and claim a refund for up to 3 years from the original due date of the return.

Curious - how much more does a CPA typically charge compared to H&R Block?

It varies a lot based on complexity. When I just had W-2 income, my CPA charged about $350 compared to roughly $200 at H&R Block. Now with rental property and some business income, I pay about $750. The difference has been worth it though - my CPA found nearly $3,000 in deductions H&R Block missed the year before I switched. CPAs generally have more education and expertise, especially with complex situations. If your taxes are super simple, the price difference might not be justified, but with any complexity, a good CPA usually pays for themselves.

Thanks for sharing! How did you find your CPA? I'm nervous about just picking someone random.