Hi,

I am a citizen of India. I am working in CA, US from Nov 11 onwards.The state tax (California) as well as the Federal tax have been deducted from the salaries of Nov and Dec 11. My overall stay in US in the year 2011 is less than 180 days. Could you please let me know if I am eligible to get full refund of the state tax and the federal tax?

Thanks and regards,

Manoj

Manoj:

It depends on the SOURCE of your income. If you are being paid by a U.S. company or a U.S. subsidiary of your employer in India, then your U.S. income IS taxable by BOTH the U.S. and California governments.

You will file as a non-resident alien, filing Form 1040NR. Now, if you KNOW you are going to return to India before November 2012, then you can claim daily living expenses (travel costs, rent, utilities, local transportation, food, incidental costs) using Form 2106 and claiming these costs as an itemized deduction. If you file as a non-resident alien, you CANNOT claim the standard deduction.

If you are married AND you will be here through June 2012, you MAY have the option of filing jointly with your spouse and you boht CHOOSING to be treated as resident aliens. That requires you claim ALL world-wide income earned in 2011, but you can also claim the foreign tax credit (Form 1116) to avoid paying double taxes.

You have to model the return BOTH ways to decide which is the best course of action. If you need professional help, email me at the email address in my signature (or in my profile if my signature is not displayed).