Hi,

I came to US CA first time on H1B on 13th Sep 2010.I came with my wife and a kid (H4) together. Now I need to file income tax.Only I am having SSN and my dependents did have any tax id.
In which category we need to file income tax for e.g. 1040 NR or something else?
Do we need to apply for TIN first? Please help.

Thanks
Rohit

Rohit:

You have a choice:

1) You can file by yourself, filing For 1040NR-EZ, since you have NOT met the Substantial Presence Test. On this return, you CANNOT claim your wife or child, but you will pay taxes ONLY on the U.S. income earned since your arrived.

OR

2) You can file jointly with your wife and you both CHOOSE to be treated as resident aliens. This will allow you to claim the $11,400 joint standard deduction plus two $3,650 personal exemption (for yourself and your wife), PLUS another $3,650 for your child PLUS the $1,000 Child Tax Credit.

To apply for an ITIN, you need to complete Form W-7 for your wife and child. You need to make a photocopy of their passports, then get each photocopy notarized. This can be done at your local bank in most states in the U.S. but NOT in California due to astrange state law, so you should contact the local IRS office to arrange to have photocopies certified as TRUE copies by the IRS. Call the office first tio ensure that they perform this function at that office.

The downside is that:

- You must wait until 25 May 2011 to meet the Substantial Presence Test before you can file for Tax Year 2010.

- You must declare ALL 2010 world-wide income (your and your wife’s home country income, if applicable). There is an offset available by claiming the Foreign Tax Credit (Form 1116).

Even with the downside, this is probably the best way for you to file.

If you need professional help filing and applying for the ITIN, email me at [email protected].