Hi,

We (myself, wife and my one year old kid) came to usa on mar'08.

I am in H1B and I am claiming in W4 as married, wife and kid as dependent with no income and child tax credit option as well.

Here is the question, both my wife and kid will be moving back to home country on 1st of Nov'08. I don't know whether I can go-ahead and apply to IRS to get a ITIN for both of them now.

If they say I can apply ITIN only when filing a tax then what are all documents I need keep for my wife and kid for tax return filing.

Some of my friends said I need to keep their notarized passport copy. Is that enough to claim as married, wife and kid as dependent with no income and with child credit option with out being them here.

I really appreciate If anyone can help me on this ?

Thanks

You can file resident tax return as Married Filing Jointly. You will get standard deduction of $10,7900 and exemptions for both of you and the kids. You will also get child tax credit of $1,000 each.

You will complete forms W7 (application for ITIN) for your spouse and children and attach with your tax return. Notarized copy of passport is required with W7.

You can also deduct moving expenses. Use form 3903. Read: Your U.S. Tax Return: Moving Expenses

Thanks for your advise.

Is there any expiry period for notarized copy, because I am planning to get notarize their passport copy and medical records by the end of October 2008 which is one week before their travelling date (1st of November 2008) and I hope I can filling my tax return only after December.

I have one more query regarding 3903, as per my understanding this is applicable only when I am moving into new location for a new job, but in my case my family is travelling back to india and I will be staying in the same place.

Am I still eligble to claim moving expenses?

Please adivse me.

You have a classic dual status situation here. You are not going to be able to file a standard resident return and unless you qualify under a treaty you won't be able to file MFJ.

cthalaim:

You said that you came to the U.S. in March 2008. So you moved from your country to the U.S. This is what I meant. Yes, you can deduct this moving expenses.

I'm sorry. I misread your original post and thought you were all moving back to your home country. I see now that only your wife and child are moving back. You are still in a dual status situation by default but some elections are open to you and your wife with regard to filing status and being a resident for the full year.

That's a good point.I didn't thought about this. Now I understand the concept of U 3903.

Yes, we spent some reasonable amount when we moved here i.e. for 15 days initial stay in hotel, food and local conveyance, but for flight tickets I got reimbursement from employer.

Once again thanks for your advise.

Yes, only my wife and kid is moving back to india.
Can you please suggest me what are those elections?

When it is time to file your tax return, you should take professional help. You can contact
The Texas Tax Expert or
AtlantaTaxExpert at [email protected]

Cthalaim:

You will be able to file jointly with your wife and you BOTH choose to be treated as resident aliens. SInce your child was in the U.S. for over 183 days, you should also be able to claim your child as a dependent and qualify for the $1,000 Child Tax Credit.

Now, since you are filing jointly, your wife will need to sign BOTH the tax return and the Residency Choice Statement, as wll as her Form W-7 to apply for an ITIN, so submitting your tax return will require some lengthy mailing times.

I handled a number of similar returns last year. It takes a bit of time, but it CAN be done.