Since you are not represented by a competent immigration attorney, the USCIS just wants all possible tax documents so a more informed determination can be made.
Hire an immigration attorney, and they can take care of it.
If no foreign income, no need to report. As for why they are asking for this, it isn't USCIS that's asking. The US Congress passed the Welfare Reform act .. .it is this law that created the requirement.
www.capriotti.com -- firstname.lastname@example.org -- Senior Legal Counsel -- Capriotti International Law -- Legal disclaimer: This answer is offered for informational purposes only. It does not constitute an attorney-client relationship. Contact the American Immigration Lawyers Association www.aila.org for a referral to an experienced immigration attorney.
Then don't worry about it. Any joint sponsor ought to provide their most recent tax return; A copy of their green card or US Passport or Naturalization Certificate or US Birth Cert or Cert of Citizenship, a fresh letter from their employer stating what they do, what their salary is and on company letterhead and also if their employed form W-2, if self employed form 1099 misc. You see, USCIS want objective proof that you're mother in law is actually gainfully employed or self employed and making the adjusted gross income she is claiming on her 1040 federal income tax return. She could claim to make a million bucks but what objective proof does she have besides her return? Thats where the W-2, or 1099 or if she's employed overseas form 2555 comes in as well as a recent employment verification from her employer. Good luck.