Dear Atlanta taxexpert,
I came in US in Aug 2002. I was on F1 visa till Dec 12, 2004. Then, I was on OPT till 15th September, 2005. Then I am on H1B visa after that. I would like to know do I have to file form 1040, 1040NR or 1040NR-EZ. Am I considered non-resident alien or resident alien for tax purposes. Do I still get benefit of US-INDIA tax treaty ? Last year I filled 1040NR-EZ for the income I earned in School.

Regards,
Mehul.

Mehul:

Unless you are hoping to claim education credits, you should file Form 1040NR-EZ again for 2005. You are considered a non-resident alien for 2005.

In 2006, you will file as a resident alien.

Dear AtlantaTaxExpert

Thanks for your reply. I am not going to claim any education credits and I am single too. Then Do I have to file 1040NR or 1040NR-EZ as I am a non-resident alien ?

But, I tried using CINTAX software and it had given me the same form(1040 NR-EZ). But it didn't gave me standard deduction of $5000. It just took $3200 as personal excemption.

But Do I get benefit of US-INDIA tax treaty as I am on H1B visa now ? If yes then I will be able to get $5000 + $3200 as non-taxable or will I get only $3200 or only $5000 ?

Regards,
Mehul

Mehul:

Unfortunately, the CINTAX software does not work well during the year you convert from F-1 to H-1B visa status.

You are entitled to the $5,000 standard deduction. You just need to put that amount where the itemized deduction go and print "Standard Deduction authorized under U.S.-Indian Tax Treaty" on the dotted line to the left of the entry on Form 1040NR.

Dear AtlantaTaxExpert,

Thanks for your help.
Can you tell me the Article number for the same treaty. The form 1040 NR needs me to write article number too.

Regards,
Mehul

Mehul:

ARTICLE 21(2)