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pidandan · Jun 5, 2007, 04:15 PM

hi, tax expert,
My parents have B2 visa and came to USA on 11/20/2006. They will continue to stay with
us until November( they got appoval for extension of stay until then). By the end of this month, they will meet the 183 days for 2007 year( they stayed 42 days for 2006 and 170 for this year). I already filed the tax return for 2006. May I apply for ITIN for them using W-7s and file 1040X for 2006 which claim them as my dependent using first-year choice?

Thank you very much.

AtlantaTaxExpert · Jun 5, 2007, 04:27 PM

You CANNOT claim them for 2006, but should be able to for 2007.

pidandan · Jun 5, 2007, 04:42 PM

Taxexpert,
I am always confused with first-year choice. Why I can't claim them as my dependents for 2006 if they meet the 183 days rule for 2007 and make the first year choice? They stayed in USA continuously for 42 days in 2006 until the last day(12/31/2006).
Thank you.

AtlantaTaxExpert · Jun 5, 2007, 08:37 PM

I called the IRS and asked about this. They MUST be in the USA for 183 in the year they are claimed to qualify.

pidandan · Jun 12, 2007, 07:55 PM

TAXexpert,
FOR the year 2006, after they make the first-year choice, they are dual_status alien(treated as resident alien for their 42 days stay using 31 days rule).Since both of them are nonresident alien at the beginning of the year and resident alien at the end of the year, they can choose resident alien for whole 2006(pub 519 for 2006 for choosing resident alien).That is why I think I can claim them as dependents, does that make sense? Of course, they will qualify for my dependent for 2007 since they will live here almost whole year. Please advise.

AtlantaTaxExpert · Jun 13, 2007, 11:26 AM

The first year choice rule applies ONLY to the taxpayer, the spouse of the taxpayer and, by implication, the CHILDREN of the taxpayer.

It does NOT apply to the parents. The parents MUST be physically located in the U.S. for at least 183 days in the tax year in question.

Hence, you can claim them for 2007, but NOT 2006.

I spent over an hour discussing this issue with the IRS representative on the IRS International Tax Hotline. Unlike the normal hotline tax advisors, the International Tax Hotline are specially trained to cover tax issues for foreign nationals. When they give you a tax ruling, you can take it to the bank.