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milind_sr · Mar 23, 2008, 12:50 AM

I landed for first time in US on 10 Oct 2007 on H1B visa and my wife came to US on 02 November on H4 Visa. I will be staying here for may be at least one year. I am confused as which form should I use 1040NR or 1040, Substantial presence test has confused me a bit. When will I pass this test, and can this help me in my taxes in 2007.

Please advice me as how/when should I file my returns to get max tax refunds.
Your help will will be higly appreciable.

~Milind

MukatA · Mar 23, 2008, 01:49 AM

You can file as residents Married Filing Jointly. But you must wait to file your 2007 tax return, till you complete SPT in 2008, which is
1/3 (days in 2007) + days in 2008 = 183.
If you file as residents, both must declare worldwide income for 2007.

choice 2: File as nonresident. You will only get your personal exemption of $3,400. You can also deduct moving expenses (for both you and spouse). You can have itemized deductions (for example State income tax paid).

milind_sr · Mar 23, 2008, 12:08 PM

Thanks for your quick reply!
One more thing I will need to know

In 2007 I just made $12,111 and paid $1056 as federal and $191 as state tax.
My wife and I had travelled to US for which the expenses were beared by the company I work for, I wonder if I can show them as my expenses?

Regarding the world wide for 2007 will I be taxed for the income I made from Jan-Sept 2007 in my native country?

Which of the above 2 choices will be beneficial for me in this case.

milind_sr · Mar 23, 2008, 12:10 PM

Thanks for your quick reply!
One more thing I will need to know

In 2007 I just made $12,111 and paid $1056 as federal and $191 as state tax.
My wife and I had travelled to US for which the expenses were beared by the company I work for, I wonder if I can show them as my expenses?

Regarding the world wide for 2007 will I be taxed for the income I made from Jan-Sept 2007 in my native country?

Which of the above 2 choices will be beneficial for me in this case

MukatA · Mar 24, 2008, 05:14 AM

You can't deduct moving expenses of your wife that were paid by the employer.

On the nonresident tax return, your itemized deduction is $191 and exemption is $3,400 so the taxable income is $7,520. The tax is about $724.

On resident return you deductions are $10,700 plus $6,800 so you don't have any federal tax. You are still left with a deduction of about $5,400. For income in the other country, you will not be paying any tax in the U.S. (or very little tax) as you will get credit for the taxes paid in the foreign country.