Hi,

I am from India.
I have been in US since 2000 August, and my spouse has been in US since 1999 August. Both of us were on F1 visas and filed 1040 NREZ and 8843 until 2004 taxes separately. We got out of school in May and started working since June 1st, 2005 on OPT, and then changed to H1B status effective from October 1st 2005. Social security and Medicare taxes were withheld for my spouse for the whole 2005 year (on F1 + OPT + H1), but none deducted for me except federal tax.

Please answer the following questions.

1) Can we file 2005 year taxes jointly?
2) What forms should we use if we file jointly, if not separately?
3) What kind of deductions are we allowed to claim for 2005?

Thank you in advance.

Tons2Think:

1) Yes, you can file jointly.

2) Because of the duration of the time you were in country from 2000 for you; from 1999 for your wife), your F-1 visa status has expired in terms of it giving you and your wife an "exempt status". For this reason, you must file as resident aliens (which is why you can file jointly).

3) You are entitled to claim personal exemptions of $3,200 each and standard deductions of $5,000 each. You can claim any credit that is due a U.S. citizen.

The withholding of Social Security and Medicare taxes from your wife's salary was correct. Further, you should have been paying these taxes as well in 2005. However, unless you intentionally withheld your duration in the U.S. from your employer, you should not be held responsible for those taxes in 2005.

You must, however,inform your employer that you are no longer exempt from the Social Security and Medicare taxes and that he should begin withholding immediately. He may withhold taxes for January and February 2006. I do not believe he can recover the withholding for any of 2005.

Thank you very much for the answers.

1) Could you please let me know the forms (1040 or 1040 NR) that we should use for 2005 Tax filing?

2) Do you think if we should definitely take help (HR block etc.) for preparation of the 2005 taxes?

3) I also spend some money on health, new vehicle etc. in 2005. Can I use all such expenses for itemized deductions?

4) Do we need to file 8843 for this year?

1) Sorry. File Form 1040.

2) No, not really. It's likely you'll file Form 1040EZ. You can do that online; I recommend www.taxact.com.

3) Not unless you own a house and are paying a mortgage or you live in a high tax state like New York.

4) No.