Hi,

I came to U.S in July 2004 from India on F-1 visa and filed 1040NR-EZ for 2004 & 2005. I graduated in May 2006 and started my job on OPT from June 2006 until Oct 2006 and continued on H1-B after that since my approved H1-B visa started in Oct 2006.

My questions are:

1. Do I file as a resident or non-resident?

2. Can I take the standard deduction of as per the India-US tax treaty? I know as a non-resident I can but can I, if answer to my question 1 is - 'Resident'?

1) Non-resident.

2) Yes.

Thanks ATE for quick response...

1. Does this mean that I can claim back the social security and medicare taxes that were deducted from my pay during the time that I was on H1-B visa since I am filing as a non-resident?

2. So, filing as a non-resident and because of the India tax treaty, are there any other deductions like education credits or something else that I can claim besides the standard deduction ($5150) and the personal deduction ($3300)?

1) No. the withholding of Social Security and Medicare taxes the day your started your H-1B visa was correct and proper.

2) No. As a non-resident alien, you are NOT eligible to claim any education credit or deduction.

Thanks again,

Seeing my pay stubs, I realized that my employer started deducting social security and medicare taxes a month later than my H1-B visa started. How do I address this issue in my tax return (if at all I have to). FYI as you mentioned above I'll be filing as a non-resident.

If you gave your employer the correct date that your H-1B visa went into effect, then you are good to go. If the employer failed to implement the law, that's his problem, not yours.