Hi. My Wife owns a S-Corp (no employees other than herself). She is on H4.
Her H4 EAD expired in Nov, 2020. Though we applied for renewal in Aug 2020, it got renewed only in July 2021.
We have applied for Green Card in Oct 2020. Now, we got an RFE asking to show Proof of Unemployment from Nov 2020 to July 2021. However, the S-Corp paid Payroll taxes during 2021 (Jan-Mar) and 2021 (Apr-Jul).
So, can someone guide on how can we show the Proof of Unemployment ?
Also, any recommendation of immigration lawyer from whom we can take help.
Is it possible to correct the taxes to show she was unemployed during that period ?
So far, we haven’t filed 2020 taxes (because we were receiving refund and we still have time). So, other than Payroll tax, no other mistake made.
So if she was unemployed starting November 2020, I dont understand why payroll taxes were paid. Unless the active shareholder (your spouse) draw wage income, there are no payroll taxes to be paid.
Please clarify the above.
If she worked for a company that made payment to the S-corp, you can ask the company to provide a letter that your wife didn’t work for them after her EAD expired in Nov2020.
You can also provide an affidavit from your wife along with bank statement for the S-corp that must show no deposits after Nov2020 from the company for whom your wife worked or for tu hat matter any other sources.
You can consult Rajiv Khanna at immigration.com or Reddy & Neumann at https://www.rnlawgroup.com/. Note that I do not work for either of them nor I get paid for any references I just know that they are good with what they do.
Thanks Kalpesh for the response. and for the references. I will take their services as I’m freaking out. As its weekend, I’m trying to gather feedback.
We have got bad advice from CPA and have mismanaged the whole thing. Usually, every quarter, CPA handles this filing and we give the checks and sign the form. I informed of going out of status but he asked us to still continue to pay payroll to be in good books of IRS.
The s-corp business had some pending money to be received from customers. The S-corp did not get generate any money from Dec 2 to May 28 but received the pending money on 29 May and once in early June. Also, November services money was received on 1st Dec. His advice was to keep minimum payment by payroll so that we are in good books of IRS. So, payroll taxes were paid.
So, we have unfortunately mismanaged it.
I tried to read the options I have to prove unauthorized work was not performed and would like to know your feedback.
a) File 941-Correction to make correction of no payroll taxes and submit that
b) Letter from the S-Corp – I’m not sure about its value. My wife is the only sole-person there. You suggested an affidavit. Can you give me more details. What should it contain.
c) I read that for employement based category, upto 180 days of violation can be overlooked. Ours is unfortunately 220 days violation but hoping if we can show at least one quarter (Jan-Mar) convincingly, we can use this provision 245(k).
Can you also help me understand the implications if the officer is not convinced of what we submit ? Is it only denial of 485 adjustment for wife or does it go beyond that ? (like deportation etc.) ?
I just know that they are good with what they do.