Hey all,

I skimmed through this forum.

Following is my understanding (Let me use my case as an example):

1. I was on F1 from Aug 2005 to September 31, 2008.
2. I was on OPT between November 11, 2008 and September 31, 2008.
3. I am on H1B starting October 1, 2008.
4. Left to US on October 24, 2008; got married, brought back spouse on November 15, 2008.
5. Spouse is on H4 visa. I will be applying for her ITIN along with my Tax Returns.

Here is how, I plan to file my Tax Return:

1. SPT Test:

We were in US for consecutive 31 days in 2008. Therefore, 53 days in 2008 and 53*(1/3) = 17 days count towards SPT.

I need to be in US for atleat = 183 - 17 days = 166 days. i.e. I will pass my SPT on June 16, 2009.
I have applied for Deadline Extension already!


2. Dual Status Alien - First Year Choice - Married Filing Jointly

If you are a Nonresident Alien who will become a Resident Alien under the Substantial Presence test in the year following this taxable year, you may elect to be treated as a Dual Status Alien for this taxable year and a Resident Alien for the next taxable year if you meet certain tests. (Refer to section "Dual-Status Aliens" – "First Year Choice" in Publication 519, U.S. Tax Guide for Aliens.)



Also, I satisfy the following:

1. Be a non-resident alien at the beginning of the year.
2. Be a resident alien at the end of the tax year.
3. Be married at the end of the year.
4. Your spouse must join you in this choice.

The results/consequences of this choice are as follows:

1. You and your spouse are treated are treated as U.S. resident for the entire year for income tax purposes.
2. You and your spouse are taxed on all of your world-wide income.
3. You and your spouse must file a joint income tax return for 2008.
4. Neither you nor your wife can make this choice again in later tax years, even you are divorced, separated or remarried.


As per the above statement, we both choose to be treated as resident alien.
I was married as of December 31, 2008. So, I plan to file "Married Filing Jointly".


3. Residency Choice letter

we must submit a statement (signed by both of us) that we qualify to make this choice and that we BOTH choose to be treated as resident aliens for ALL of 2008.

i. Attach a statement to Form 1040 that I making a First Year Choice.

ii. I am Non Resident in 2008 and This Year (2009) under Substantial Presence Test and I will be a Resident.

iii. Calculation on the dates of presence and absence in 2008 and 2009.


Now that logically we could file 1040 R - Married Filing Jointly - First year choice. Here are the Questions:
1. Can we get Standard Dedution for both ($10,900)?
2. Do we have to pay SS and Medicare for the period January 1, 2008 to September 31, 2008, While I was on OPT? If so, How?

Thanks in Advance!

Arvind

For 2008 return, you can file resident tax return as Married Filing Jointly. You will have to wait to file your tax return till you meet the Substantial Presence Test in 2009.

You will get standard deduction of $10,900 and exemptions for both of you.
Read about H1-B tax filing: Your U.S. Tax Return: The U.S. Visas (http://taxipay.blogspot.com/2008/08/us-visas.html)

Thanks a Ton! MukatA.

Do we still have to pay Social Security Tax and Medicare Tax for the entire year including the period I was in OPT (January 1, 2008 to September 30, 2008)?

Thanks again.

Arvind

Arvind:

You were NOT subject to FICA taxes from 1 Jan to 30 Sep 2008. Ask your employer for a refund of the FICA taxes for that period. If the employer refuses, get the refusal in writing on company letterhead and include that letter with Form 843 to request a refund of the FICA taxes.

AtlantaTaxExpert,

Thanks for the Reply.

My employer did not deduct FICA taxes during my OPT period (January 1, 2008 to September 30, 2008).

I read in one of the threads on similar topic, where you and MuktA have debated over FICA taxes during OPT. I am currently Non-Resident. I plan to wait till I pass SPT and then file my taxes as resident - married filing jointly. By doing this, will I be considered resident for the whole tax year? And do I have to forfeit the OPT tax advantage?

Thanks again!

Arvind

Arvind:

The IRS has since come out with definitive guidance that those who choose to be treated as resident aliens for an entire will NOT be subject to back-FICA taxes.

File jointly with your spouse and choose to be treated as resident aliens for all of 2008.

Thanks a Ton, AtlantaTaxExpert

Arvind

Glad to help!

Good News!

I filed my wife's ITIN W7 application along with my 1040 on June 24, 2009 in person at the nearest IRS office.

Got the ITIN on June 20, 2009

I got my refund on July 22, 2009 for the exact amount.

Man! That's quick.

Arvind