Hello,

In autumm 2006 I moved back to Europe from USA after being there continuosly 2 years (with L1 visa). Because of the move I think I am considered to be a Dual-Status Alien (i.e. I was not present in USA at the end of the year). I will be travelling back to USA in several separate business trips and will have income (and paying appropriate taxes) in USA also in 2007 (I will have the W2 form etc. things). So which form should I use in 2006 return? Can I use form 1040 and in 2007 form 1040NR?

I would prefer using 1040 because filing married jointly would be beneficial for me.

John

AtlantaTaxExpert

For 2006, you must file BOTH Form 1040 (as an attachment) and 1040NR (as the actual tax return). You CANNOT file jointly.

For 2007, file Form 1040NR as a non-resident alien.

MrExpat

Thanks for the info.

In the publication 519 chapter 1, Dual status,last year of residency there is a statement

"Residency during the next year. If you are aU.S. resident during any part of 2006 and you are a resident during any part of 2005, you will be taxed as a resident through the end of 2005.
This applies whether you have a closer connection to a foreign coutry than the United States during 2005, and whether you are a resident under the substansial presence test or green card test."

What this statement actually means? Does it mean that if I live in 2006 certain time in US then I can file 2005 as a resident and use Married with jointly? (the years are not correct but I used them because the publication uses the same.

AtlantaTaxExpert

If you are in non-resident alien status for even ONE DAY in 2007, you cannot file as a resident alien in 2007. The best you can do is dual-status, and that requires at least 183 days in the U.S.