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An American Expatriate and Taxpayer Advocacy

GR is an American expatriate who has resided in Spain for many years.  He is married to a Spanish citizen who for US tax purposes is described as a nonresident alien.  GR used to file his annual tax return as Single until he married.  Thereafter he changed his filing status to Married Separate.  In order to save taxes, his accountant advised him to file Married Joint.  But first his wife had to apply for a Taxpayer Identification Number (TIN), since Internal Revenue Service will not allow taxpayers to claim dependents without a TIN or Social Security Number. 

Accordingly GR downloaded Form W-7 – Application for IRS Individual Taxpayer Identification Number – from the IRS website (www.irs.gov), filling in the necessary information and obtaining a notarized copy of his wife’s Spanish passport from a US notary at a US consulate in his area.  He then filed these forms with his 2005 tax return in May 2006 at the Philadelphia Service Center. 

In September 2006, he received a reply to his application, informing him that IRS Philadelphia had rejected his application.  Referring to an earlier unanswered letter (which GR did not receive), the Service stated:  ‘The supporting documentation that you sent with your Form W-7 is unacceptable.  Your supporting documents must be Original or certified by a US notary.  You (also) did not provide the name and tax identification of the US person who can claim you as a dependent/spouse.’

GR was puzzled.  Had he not provided this required information in his application? In coming months, his representative wrote repeatedly to the IRS office in Paris, which is responsible for overseeing tax matters of American expatriates in western European countries including Spain, to clarify IRS Philadelphia’s requirements.  Unfortunately, for virtually a year, IRS Paris never provided any answers.  Meanwhile, unable to amend his tax returns for Married Joint, he was denied tax refunds otherwise available by amending prior year tax returns.  

In an effort to assist taxpayers who are waiting for overdue responses from IRS, the Service in 2002 launched the Taxpayer Advocate Service.  The Advocate Service is free, confidential and available to individuals and businesses.  Any qualified applicant should receive personalized service from a knowledgeable advocate who will listen to his or her situation, explain how to resolve the problem, and monitor progress toward resolution.  Taxpayers can be represented by a tax accountant or attorney.   There are no advocates outside the continental United States. American expatriates should apply on Form 911 – Application for Taxpayer Assistance Order – available at the IRS website.

How will Taxpayer Advocacy Service work in practice remains for GR to find out.  After a very long year of waiting, he is not sure whether TAS, an offspring of IRS, will correct the sins of its sponsor.  But perhaps it will.  The propaganda on TAS is promising:   http://www.irs.gov/advocate/index.html.