[frustoofighter]

Hi,

Some background about my case:

I have been in USA since Nov 2006 and I filed 1040NR-EZ last year. I got married in 2007 and my wife came back with me on Dec 15th 2007.

Having read a lot of posts in this forum, I believe that I can use the married filing jointly status for my returns if I:
1. attach a W7 form with a notarized copy of my wife's passport.
2. attach a statement saying that my wife choses to be a resident alien for this year.
3. report the worldwide income for my wife.

My questions are :
1. How do I actually report the worldwide income for my wife (and which form do I choose for filing the return) ?
2. Can the income my wife earned in India be exempted using the Foreign Earned Income Exclusion criteria (as she was in India for more than 12 months/330 days) ?
3. Also, finally can I claim moving expenses for her?

Thanks in advance!

[AtlantaTaxExpert]

1) You would use Form 1040. If her income is wages, they are reported on Line #7.

2) Maybe, but, for sure, you can file Form 1116 to claim a Foreign Tax Credit on any income tax she paid to India.

3) Yes, using Form 3903.

[MukatA]

Hi,

2. Can the income my wife earned in India be exempted using the Foreign Earned Income Exclusion criteria (as she was in India for more than 12 months/330 days) ?
Thanks in advance!

Yes, she should qualify for Foreign Earned Income Exclusion of up to $85,700 (form 2555).

She must meet at least one of the two tests to qualify for Foreign Earned Income exclusion:
Physical Presence Test. You were present in foreign country for full 330 days in any period of 12 months in a row. (That is these 12 months can include two tax years.)
Bona Fide Residence Test. Since you are citizen of the foreign country you meet this test, unless you were in the foreign country for definite temporary purpose.

[frustoofighter]

First of all, thanks for your prompt replies! They were extremely helpful :) . I have a couple of more doubts though:

1) You would use Form 1040. If her income is wages, they are reported on Line #7.

Line 7 says to attach a W2 form but my wife does not have a W2 form for her earnings in India. So should I just add her income to mine and report the total amount? Do I need to mention in an attached statement that the "total amount = my earnings as on W2 + wife's earnings in India" ?

3) Yes, using Form 3903.

In one of your previous posts, I read that you can only claim moving expenses for a household member if the household member used to stay with you before you moved to USA. I got married only in Nov 2007 whereas I had moved to USA in Nov 2006. So can I still claim moving expenses?

Thanks again for your time and effort!

[AtlantaTaxExpert]

At this point in time I will NOT contest MukatA's post, but I still need to do my own research!