I holding a H1B Visa from Cognizant and working for the client in US from 27 July 2008. My spouse and child dependents also joined in Dec 2008. I got my W2 form for 2008(for 5 months and 3 days in 2008).

Do I need to use 1040 or 1040NR to file my tax returns. Am I eligible for standard deduction? Can I have the option to file jointly? Can I take personal exemption for me and my wife and child dependent credits if 1040NR?

This is my first US trip. I Worked 153 days in 2008.

Please advise.

You can file jointly with your wife and you both CHOSE to be treated as resident aliens. This will allow you to claim the $10,900 joint standard deduction plus two $3,500 personal exemption (for yourself and your wife) plus one $3,500 for your child PLUS the $1,000 Child Tax Credit.

You will need to submit Forms W-7 to apply for ITINs for your wife and child. A notarized photocopy of their passport needs to be stapled to the W-7.

The downside is that:

• you must WAIT to meet the Substantial Presence Test before you can file, which means you must wait until 21 May 2009.

• you must declare ALL 2008 world-wide income, but you can at least partially offset any double taxation by claiming a Foreign Tax Credit (Form 1116).

Even with the downside, this is probably the best way for you to file.