Dear experts at askMeHelpdesk. I need your expert guidance. The so called experts at some premium tax consultancies have given me contradicting advice. Let me state the facts and my questions and also the educated responses that I have got from the experts. I apologize for the lengthy post, but I want to explain everything well.


Fact 1 : I was Present in the US in 2007 for 56 days (Jan 01 - Feb 26)
Fact 2 : I was out of USA for the entirety of 2008 (0 days in 2008)
Fact 3 : I returned to USA on July 9'2009 (177 days in 2009)
Fact 4 : I am married and i have a kid .
Fact 5: My wife and kid were Not present in the USA for 2007 and 2008. They have come to the US with me on July 11'2009 . This implies that they were present in US for 177 days in 2009 and 0 days in 2007 and 2008.
Fact 6: The income that i have earned in the US for 2009 is less than $35000.



Here are the questions that I have asked to the tax consultants


Question 1 : Can i be be treated as a resident alien for tax purposes. The sum of the nr of the days that i have stayed in 2009,2008 and 2007 is 177+0+9 = 186(which is > 183)



Answer from the Block :- Yes i can consider myself as resident alien; This is in spite of the fact that i was out of the country totally in 2008. My total absence in 2008 doesn't matter. I can take credit for my presence in 2007 and add it to my presence in 2009 and i qualify.

Answer from the Hewitt :- No, i don't qualify for the resident alien status. Due to the fact that i was totally out of the country in 2008, i have to consider 2009 as my first year of residency and since i have been in the country for only 170+ days, i don't qualify



: Question 2 : Assuming that i can be considered as a resident alien based on SPT, can my wife chooses to jointly file with me as a resident alien. If so, do we have to declare our worldwide income and are there any means to offset this.



Answer from the Block :- If my wife chooses to jointly file with me and be treated as a resident alien, then both of us have to declare our world wide income. To mitigate this liability, we need to file FORM 2555 which will help us to exclude our foreign income from being considered for taxation. If our come exceeds the $90,000 threshold,then we
can file FORM 1116 in addition to FORM 2555.

Answer from the Hewitt : Hypothetically considering that i satisfy the SPT(which they have said that i didn't), then me and my wife can file jointly as resident aliens. However, since my wife has chosen to be treated as a resident alien, the benefits of FORM 2555 are not available for us. Instead, we have to file FORM 1116. But their recommendation that i file for an extension right now, wait till i reach SPT in 2010 and then since both my wife and i would have attained resident status and we need not even declare of worldwide income.




: Question 3 : Can i claim child tax credit for my 2 year old, in spite of her not satisfying the SPT. Its her first time in the US and she has only stayed 177 days in 2009.



Answer from the Block :- If me and my wife decide to file our returns jointly as resident aliens, then the fact that my child has not completed the SPT doesn't matter. My daughter can choose to be considered as a resident alien (something to do with her first year status) and we can claim the child tax credit right away.

Answer from the Hewitt : According to them i have not satisfied the SPT, therefore i have to file as a non resident alien and hence i cannot claim the child tax credit. However if i decide to wait till i reach SPT on 2010(i have to wait till May 15 '2010 or so), then me and my wife can file jointly as a resident alien and i can get the child tax credit for my kid for 2009



Thank you for your time and patience

Your visa status for 2007, 2008 and 2009?
If you have work visa, you can file joint return as residents for 2009 and claim your child.

Dear MukatA
Thanks for your reply. My visa status for 2007,08,09 is L-1B/NA/L-1A.
If you have some time, could you please elaborate on the correctness of the advice that I have received from the block and Hewitt.

You have completed SPT in 2009, so you can file joint return as residents without waiting.

Dear Mukata, thank you. I hope that I can take the liberty to ask you one more follow up question. Can I claim child tax credit for my kid , in spite of the fact that she has not passed the substantial presence test for 2009.

If yes, is it because my daughter chooses to be treated as a resident ? I ask this because one of the tax consultants had told me that I cannot claim credit for my kid because she has not passed the substantial presence test for 2009 (she came on July 05'2009) and its her first time here.

If your child spent ANY part of 2009 in the U.S. and was in the custody of one of the parent for all of 2009, you can claim her as a dependent AND claim the $1,000 Child Tax Credit.