I am trying to file taxes for the 2007 year. I had scholarship money and a $3000 award at graduation so I have some taxes to pay on top of what my employer withheld. I am curious about the deductions I am able to take as a NR.

I have figured out that I can take the Retirement Savings Credit of $200 because I made under $26,000, and contributed to a company 401(k) and a Roth IRA. Can I take a deduction for my school expenses during the spring semester? I spent a couple of hundred on books. (I know as a NR I do not qualify for the Hope or Lifetime Learning Credits, which is why I am wondering if I can qualify for this). Also, I had some moving expenses from Canada to North Carolina where I started my first job in July. I do not have receipts, but can I take a mileage deduction and a standard deduction for food during the two full days I traveled?

Any help you can provide me with would be much appreciated!

AtlantaTaxExpert

If you are a student, you CANNOT claim the Retirement Savings Credit; sorry!

As a non-resident alien, you are NOT eligible to claim education credits or deductions.

You CAN claim the moving expenses by filing Form 1040 and Form 3903.

MukatA

If you are a degree candidate and if the financial aid (includes scholarship and fellowship) is for tuition fee, other fees, books, supplies and equipment, then it is not taxable. For a degree candidate aid for boarding and travel are taxable.

If you are not a degree candidate, then all the financial aid is taxable.
You must use Worksheet 1-1 in Chapter 1 of Publication 970 to figure out the taxable amount.

AtlantaTaxExpert

Agreed.

cachick

Thank you for your response. I called the IRS and spoke to them regarding the retirement credit. Since I was only a student during the spring semester (Jan-Apr) I am eligible because I was not enrolled for five months as a full-time student for 12 months. They said that I could therefore take the credit.

I am a little confused about the moving expense credit, I can only take it if I file a 1040 and not a 1040 NR?

AtlantaTaxExpert

How is it that you were only a student for 4 months?? That's a bit strange.

You can claim moving expenses on Form 1040NR; look on Page one, under INCOME ADJUSTMENTS.

cachick

I graduated in the first week of May but I finished all my courses at the end of the semester in April. How long is a semester usually? (I'm a little confused.) I started school in fall of 2003 and graduated spring of 2007.

I asked the lady at the IRS and she said that I couldn't take a moving expense deduction since I had taken a job in the same area I went to school. Because there was a gap between my OPT being approved and the end of school, I had to move all my things home (to Canada) and then all the way back down a month later to NC. She said since I already had the job, I couldn't claim it because I technically didn't move. Is this accurate?

AtlantaTaxExpert

That IS accurate. The IRS would consider your move to Canada as a voluntary move on your part, NOT a job-related move.

cachick

Thanks for the explanation. Do you think that my retirement credit is valid?