[geo2007]

Hi,

I am on H1B visa arrived in the US in October 2006. My wife and child are on H4. For 2006 I filed 1040NR and consequently could not claim my wife and child as dependants.
From what I understand now I can file form 1040 or 1040A based on substantial presence (351 days in 2007 in the US plus some 80 days in 2006)...

1. Is this correct? Can I file as a resident alien Form 1040 or 1040 A filling jointly with my wife since she does not work and has no income?

2. Provided I do file either 1040 or 1040A, how do I claim my wife and child as dependents if they don't have a SSN. Can I live SSN entries blank and insert in the ITIN W7 form for both of them? Would this work?

3. What is the difference between 1040 and 1040A? Which one applies to my case?

4. Can I claim the interest I have paid on my mortgage for 2007?

Thank you very much, I appreciate all the help.

[AtlantaTaxExpert]

You COULD have filed as a resident alien for 2006 if you had just waited until June 2007 to file. You can correct that mistake by amending your 2006 return.

For 2007:

1) Yes, you are fling jointly with your wife using Form 1040 or 1040A.

2) You will need to submit ONE Form W-7 for your wife and each child to apply for an ITIN for them. It is submitted with the 2007 tax return, with their names on the return and the SSN areas blank. The IRS will issue the ITINs, insert them on the return, process the return, then send the ITINs to you in separate envelopes. Once you get the ITINs, you can then amend your 2006 tax return.

3) The Form 1040 is more flexible and allows more deductions and forms/schedule to be filed with it. Due to the answer to #4 below, you need to file Form 1040.

4) Yes, you deduct the mortgage interest on Schedule A, which is filed with Form 1040.

Recommend you get professional tax help. Contact me at the email address below if you want to use my services.