I read in one of threads the Atlanta Tax Expert suggested the use of CINTAX and I tried to use it today, but to my surprise it did not fill the $5,000 treaty exemption or the standard exemption in the 1040 NR EZ form that it generated though it asked if I ever used the treaty exemption in 2004 and I mentioned it was under India article 21(2) [a US std. deduction of $ 4850].

My details:
Used 1040 NR-EZ and 8843 for 03 and 04 tax years.
F1 - August 2003 to December 2004
OPT from January 11 '2005 to July 10 '2005
H1 - since July 10 '2005

Kindly let me know if I can claim the deduction though the software did not generate it?
It is my understanding that it could have been just a software glitch or am I just not qualified to claim the $5000 standard deduction?

Your response shall be really appreciated.

Thanks
Modi.

I just read the reply by ATE about the error in CINTAX.
Maybe I shall fill it manually, unless you have a better suggestion.
Thanks for all the posts in this forum.

Hemal.

1. Change of status from F1/OPT to H1 after July 1st or 2nd (substantial presence) still allows you to file as a Non-Resident and use 1040 NR & 8843. But next year we need to use 1040 or 1040 EZ, 1040A (is any other form required)

2. Can a resident alien on H1B use the US-India treaty std deduction in 1040EZ/1040A?
Or is one restricted to just the personal exemption of 3200$ or can he still claim the 5000$ std deduction under the US-India Income tax treaty?

3. Who can and how can we use the 4000$ IRA deduction?

4. If one gets married in that tax year, he shall apply for ITIN for the Spouse on H4 and file jointly?
Filing jointly as a resident alien will allow one to claim a $10,000 standard deduction and $6,400 in personal exemptions (& forfeit any refund of withheld Social Security or Medicare taxes during the F1 status).

5. When does one need to apply for "resident alien under First Year Choice" ?

6. When & why does one need to file an extension?

I shall really appreciate your response.

Thanks
Hemal.

Hemal:

1) That is correct.

2) Yes, all resident aliens get the $5,000 standard deduction. It has NOTHING to do with the US-India Income tax treaty.

3) IRA deduction is available to BOTH resident and non-resident aliens if they meet the income limitations.

4) That is correct. If you marry during the tax year and apply for the ITIN while filing as a resident alien (perfectly legal, even if spouse is NOT in the U.S.), you will likely forfeit the right to the refund of improperly withheld Social Security or Medicare taxes during the F1 status.

5) Normally AFTER you have qualified for Substantial Presence Test using all of 2006 days and one-third of the 2005 days while under H-1B visa status; probably no earlier than May 2006.

6) Extension via Form 4868 has to be psotmarked or filed electronically by 17April 2006. Why? Because that is the law!

1) If I pass the substantial stay test then do I need to use 1040 or 1040 EZ, or 1040A? Is any other form or a combination of those required?

2) Since all resident aliens get the $5,000 standard deduction, do we need to mention any treaty in 1040 form?

3) -

4) If the spouse is not in US do you file it as a single or married but filing separately? When can you consider "Head of household" & what are the benefits?

5) If I apply for extension and file it after May 10, 2006 will that be any beneficial, considering that all I can claim as a single person is still the same 5000+3200 (no mortgage or anything to have itemized deduction cross 5000$)?

6) I asked why to understand the benefits & reasons behind the intention to file it under "resident alien under First Year Choice"?

Thanks a ton for all your replies and concern.
Hemal

1) Only one form (1040, 1040A OR 1040EZ).

2) No need to mention the tax treaty.

4) The SPOUSE does not have to be in country to file jointly; the children have to be in country to be claimed, however.

5) Probably not; file as a non-resident alien.

6) Okay!