Hi
I am from India and arrived in US for the first time on H1B visa on 10th Nov 2007, and my estimated gross income from salary till Dec 31, is around 11000 USD.
Will I have to pay tax for this short duration during this financial year and if yes, how is it going to be calculated?

Thanks in advance
Milind

Milind:

Yes, you WILL PROBABLY have some tax obligation.

If you are single, you will file as a non-resident alien (filing Form 1040NR or 1040NR-EZ). You will be able to claim a $3,400 personal exemption for yourself. If you have no deductible moving expenses (which depends on what you paid out-of-pocket with no reimbursement from your employer), then about $7,600 will be subject to U.S. income taxes. That will be taxed at 10%.

You are also liable for FICA (Social Security @ 6.2% and Medicare @ 1.45%) taxes, which are flat taxes assess on each paycheck at the percentages noted.

You are also liable for STATE income taxes for the $11,000 earned in the particular state in which you worked, unless you are in one of seven states that have NO state income tax.

If you need professional help to file your return, contact me at [email protected] for a fee quote.

Milind files as non-resident alien and will only get personal exemption of $3,400. However he can deduct some moving expenses as itemized deductions. It can be air fair from India to the U.S. and other moving expenses.

Moving expenses can also be deducted if the moving reimbursement from the employer is given in the form of some type of taxable payment, such as a signing bonus.