I talked to some guy the other day and he was telling me he did his taxees last year with his ITIN because he doesn't have a social security and he got aroun $9000 back from the IRS..!! by claiming his daughter..!! How is that possible..??
2007-02-16 04:28:10 · 4 answers · asked by Nita 2 in Business & Finance ➔ Taxes ➔ United States
I tried to help a friend with his taxes but was in the same case he dodn't have SSN and he want it to get and ITIN but, correctme if I'm wrong but I was told that they will only get back the amount they pay in taxes on their W-2 even if they report a dependent
2007-02-16 05:16:33 · update #1
It would be very possible. If he has an ITIN, that means he did not qualify for a SSN. His employer then most likely treated him as a nonresident and withheld federal taxes at 30% (which is the statutory withholding percentage for nonresidents). He probably claimed his daughter as a dependent, therefore he filed as a head of household, so his actual tax rate is much lower than the 30% that was withheld from his taxes.
Now many people will say that he cannot claim his daughter if she is not a citizen or green card holder. That is not true. That rule ONLY applies when the individual does not live in the US. Residency for purposes of taxes is tax residency, not citizenship. There are three ways you can be considered a tax resident of the US.
1. Become a citizen of the US either through birth or naturalization.
2. Become a permanent resident of the US through the receipt of a green card.
3. Meet the physical presence test. When a person is physically present in the US for more than 183 days over a three year period, then the person is considered a tax resident of the US as of the first day they are present in the US during the tax year.
Of course, for a foreign national coming into the US, their first tax year in the US and the tax filing is very complex. If his return was not prepared by a person that is knowledgeable about the myriad complexities related to a person coming into the US, chances are that his return may have been prepared incorrectly and the IRS may review and change his tax assessment. In that case, the IRS may end up disallowing his dependent claim, his filing status, etc. and he may get a nasty tax bill in the mail.
2007-02-16 05:02:15 · answer #1 · answered by jseah114 6 · 0⤊ 2⤋
A person with an ITIN number can claim all the credits except the Earn Income Tax Credit. You also have to understand that some people like to exaggerate when it comes to their refund. To get back a $9,000 with just one daughter you need to have more information because what you have there is not enough.
2007-02-16 12:52:52 · answer #2 · answered by yarrie15 2 · 1⤊ 1⤋
It could be possible if he had lots of federal withholding on his
W-2 and had no tax liability.( he probably itemized all his deductions to lower his income and have no tax liability and receive all his federal withholding back.) A person with a Individual Tax Identification Number will qualify for all credits except the Earned Income Credit. And depending on his income he qualifies for a Child Tax Credit and an Additional Child Tax Credit.
2007-02-16 13:34:07 · answer #3 · answered by friendlydidly 2 · 1⤊ 0⤋
The amount of refund isn't what matters, it's the amount of total tax paid. Anybody can get a big refund. If you have an extra $1000 a month withheld from your paycheck above what's needed to pay whatever taxes you owe, you'd get a $12,000 refund. Does that sound good? I don't think so.....
2007-02-16 18:09:56 · answer #4 · answered by Judy 7 · 0⤊ 1⤋