Hi,

I came to US for the first time from india in aug 5,2013. I am maried and having 2 kids. For 2013 My tax consulatnt said that you can file as resident using first year choice and he filed a extension for filing and filed in 2014 June after meeting the spt. After filing I got verification notice in July and went to IRS for verifying identity. The local IRS officer said that I filed my tax in wrong form (1040) and I am supposed to file 1040NR. I claimed child tax credit also. I am worried why they received intialy in June and now getting this as invalid. AM I elgible to use first year choice and 1040 .Please advice.

Thanks
Natar

Natar,

You ARE eligible to file jointly with your wife and claim the Child Tax Credit under Form 1040 once you waited to meet the Substantial Presence Test. The IRS representative is wrong in this case.

I assume you applied for ITINs for your wife and child under the assumption that they do not have SSNs.

However, in filing as a resident, you have TWO requirements:

1) You must declare ALL world-wide income, which means you must declare the Indian income earned from 1 January 2013 onward. You would file Form 1116 to claim the Foreign Tax Credit for indian income taxes paid.

2) You must also file a statement (signed by BOTH you and your wife) that you qualify to file a joint return as residents and that you CHOOSE to be treated a U.S. residents for all of 2013.

If the second requirement was not done, then the IRS agent was technically correct.

So, did you apply for ITINs by submitting Forms W-7 and the required support documentation?

Thanks Expert for your answer. I did the both you mentioned.

1. filed worlwide income and also attached a statement (signed by me nad my wife ) to treat as joint residents.

Can you please give any links or supporting documents to check this rule ,so that I can show to the IRS officer by going again.

Thanks for your quick reply and support

All of the requirements can be found in IRS Pub 519 under "First-Year Choice".