I didn't even consider filing separately! Did you still get to claim the mortgage interest and property tax deductions that way? And did you have to do anything special with the marketplace insurance forms?

When filing separately, only the spouse who actually paid the mortgage interest and property taxes can claim those deductions. In our case, we had set up our mortgage so both our names were on it, and we paid from a joint account, so we could document that my wife (the lower earner) paid those expenses. This helped maximize the benefit. For the marketplace insurance forms, it gets a bit complicated. You'll need to allocate the premium and subsidy amounts between spouses. Our tax preparer handled this for us, dividing it based on who was actually covered by the policy. The key benefit was that by filing separately, my wife's income alone (not our combined income) was used to calculate the subsidy repayment for the months before we were married.

The Saver's Credit phases out pretty quickly though. For 2025 filing, married couples filing jointly lose eligibility when their AGI exceeds $73,000. Given their combined income of about $103k, they probably won't qualify.

Would Form 843 work even though the mistake is from a few years ago? And should I hire a different CPA to handle this or try to do it myself?

Yes, Form 843 can still be filed for the tax year in question even though it's from a few years ago. The statute of limitations for filing a claim for refund or abatement is generally three years from the date the return was filed or two years from the date the tax was paid, whichever is later. Since you're just now discovering this issue, you should still be within that timeframe. I would strongly recommend hiring a different tax professional to handle this rather than trying to do it yourself. Look for an Enrolled Agent or CPA who specializes in tax resolution or IRS representation. They'll know exactly how to present your case for maximum chance of success and can handle all communications with the IRS on your behalf. Given the significant amount at stake ($32,000), professional assistance is definitely worth the investment.

This is the real answer. My dad's accountant made a similar mistake and ended up paying the entire bill including penalties because it was 100% their error. Don't just accept this as your problem to fix!

3 Does your spouse physically need to sign the statement? My husband lives in Australia and getting documents back and forth is a pain. Can he just sign electronically?

17 Your spouse does need to sign it, but electronic signatures are accepted by the IRS now. My wife was able to sign the document digitally and send it back to me as a PDF. Just make sure it's a proper digital signature, not just a typed name. The statement itself isn't complicated - it just needs to clearly state that you're both electing to treat the non-resident alien spouse as a US resident for tax purposes, include both your names, the tax year, and both signatures. There's no specific IRS form for this statement.

10 How long did it take to get the ITIN for your spouse? I heard the processing time can be really long.

Oh no, I didn't make any quarterly payments! This is my first time dealing with self-employment. Will the penalty be really bad? And should I start making quarterly payments for this year right away?

The penalty usually isn't too severe - it's basically an interest charge on what you should have paid earlier. There are some safe harbor rules that might help you avoid it, especially if this is your first year with self-employment income or if your W-2 withholding from any other jobs covers at least 90% of your total tax liability. Yes, for 2025 you should plan on making quarterly estimated payments. The due dates are April 15, June 15, September 15, and January 15 (of the following year). You can use Form 1040-ES to calculate and submit these payments. It's much easier to pay a little each quarter than to be hit with a large bill at tax time!

I used HR Block last year for my Schedule C (freelance writing) and it was ok but not great. The interface was a bit confusing for business expenses. This year I switched to TurboTax Self-Employed and found it more intuitive - it asked better questions to help identify deductions I might have missed. It's more expensive but worth it if you have various expenses to deduct.

Thanks for the advice! Do you think it's worth paying for the premium versions of tax software? And what questions should I ask when interviewing a potential tax preparer?

For your situation with multiple W-2s and a dependent, the Deluxe version of most tax software should be sufficient - you probably don't need to go higher unless you have investments, rental property, or self-employment income. When interviewing tax preparers, ask: "How do you stay current with tax law changes?", "What's your approach to reducing tax liability?", "Do you provide guidance throughout the year or just at tax time?", and "How do you handle IRS notices or audits?" A good preparer should ask YOU questions about your financial situation and goals, not just take your forms and process them.

This! I learned this the hard way. The W-4 form has a multiple jobs worksheet or you can use the IRS withholding calculator online. I set my second job to withhold at the higher single rate with no deductions and that fixed my problem.