[aureliedlb]

Hello,

My husband has a H1B and I have a H4. He has worked since October, 4th 2010(we are french).
So we are non resident for 2010.

I understand that we have to file a 1040nr but in this 1040nr we can't choose exemption for wife (we don't have the choice "married filing jointly".
So what can we do in this case ? The spouse isn't considered ?

Thanks for your answer
Aurelie

[MukatA]

You have two choices.
Choice 1: You did not complete SPT in 2010, you can file non-resident tax return.

Choice 2: You can file resident tax return as Married Filing Jointly. You must wait to file your tax return till you meet the Substantial Presence Test in 2011.
Your U.S. Tax Return: Substantial Presence Test

You will get standard deduction of $11,400 and exemptions ($3,650 each) for both of you.
You must both declare your worldwide income for 2010. If you have any foreign income, and on that income you paid taxes in the foreign country, then you can claim foreign tax credit (Form 1116) or you can use Foreign Earned Income Exclusion (Form 2555). Read: Your U.S. Tax Return: U.S. Citizen or Resident with Foreign Income

You will complete forms W7 (application for ITIN) for your spouse and attach with your tax return. You can also deduct moving expenses. Use form 3903.

If you decide to file as Married Filing Jointly as First Year Choice, you must attach a statement signed by both of you to your return stating that you qualify to file as residents as First Year Choice and that you CHOOSE to file this way.

File state tax return only after you get ITIN. Make sure to pay any tax due on or before April 15, 2011. If needed, file for extension.

[aureliedlb]

Thank you for your answer, that help me a lot !

I still have some questions :
- If a choose the choice 2, I have to wait till I met the SPT. So if I came in CA the 09.29.10 afternoon, (93 days in 2010) I have to wait 183-(1/3*93)=152 days in 2011 so the 1st of June 2011. That is after the limit time to fill, so I have to ask an extension right ? How ?

- with the choice 2, I have to declare our worldwide income for 2010 : is it a gross income ? We earned 89.780$ (wages) + 6.460$ (rent of our property) = 96.240$. I think it is too much and it is more than the foreign earned income exclusion amount for 2010 ? So we will pay tax on that too ?

- for the state tax return, how can I be sure that I paid all I have to ?

I'm not sure that I will be able to do all of that by myself, do you think it can be done alone ?

Thank you for your answers !
Aurelie

[MukatA]

Yes, if you opt to file joint return as residents you will file Form 4868.

Your earned income exclusion is for exclusion of earned income. That you may be able to exclude wages using Form 2556. For rent income, you will use Form 1116 to claim foreign tax credit.

[aureliedlb]

Hello,

Thanks again for your answer.
I modeled the both ways and I think it is the same result in each case because the incomes in France are important (even using Foreign Earned Income Exclusion (Form 2555)).
So I think I will use the easier way (file non-resident tax return).

Thanks
Aurelie

[MukatA]

May be as for 2010 you will have little US income, only for less than 3 months. Then you can claim moving expenses for family if you came to US on H1. Use Form 3903. You will have no or little taxable income.

[aureliedlb]

Just to be sure, if my husband file non-resident tax return then the spouse (me) doesn't need an ITIN ?
I don't have to send a W7 form, right ?

Anyway, is there an advantage to have an ITIN ?

Thanks !