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norham1 · Feb 10, 2011, 02:09 PM

I know resident aliens can get the making work pay credit? What about dual status taxpayers -- people who file as both resident and non-resident aliens in the 2010 tax year?

Thanks

MukatA · Feb 10, 2011, 07:35 PM

Yes, for income during the resident period.

norham1 · Feb 14, 2011, 09:05 PM

I am unsure what you mean by this. Do you mean IF THEY EARN income during the resident period -- which pretty much all dual status person will.

MukatA · Feb 15, 2011, 01:10 AM

Nonresidents do not get Making Work Pay credit.

norham1 · Feb 15, 2011, 05:02 PM

Dual status taxpayers file as both residents and nonresidents.

Do you know of some explicit statement, regulation, rule etc. about whether dual status taxpayers can get the making work pay credit?

crazee85 · Mar 5, 2011, 06:17 PM

Even I have the same question. Can dual status aliens get the Making Work Pay Credit?

Thanks!

crazee85 · Mar 5, 2011, 10:49 PM

In Section 36A of ARRA Code (American Recovery and Reinvestment Act of 2009/Division B/Title I/Subtitle A - Wikisource), it says:
"The term `eligible individual' means any individual other than—
(i) any nonresident alien individual,..."

On page 35 of publication p519, it mentions:
"As a dual-status alien, you generally can claim tax credits using the same rules that apply to resident aliens."

Does this imply a dual-status alien should be able to claim Making Work Pay Credit?

crazee85 · Mar 6, 2011, 12:47 PM

Also in the 'Restrictions for Filing Dual-Status Tax Returns' in p519 (2009), it says:

"6) Tax credits. You cannot claim the education credits, the earned income credit, or the credit for the elderly or the disabled unless:
You are married, and
You choose to be treated as a resident for all of 2009 by filing a joint return with your spouse who is a U.S. citizen or resident, as discussed in chapter 1 ."

Since Making Work Pay Credit was for both 2009 and 2010, I believe they would have had included this credit also in the Restrictions list if dual-status aliens were not allowed to claim this credit.

So I guess a dual-status alien should be allowed to claim Making Work Pay Credit.

Any inputs?

crazee85 · Mar 7, 2011, 07:25 PM

Any help will be highly appreciated in this regard... thanks!

crazee85 · Mar 8, 2011, 03:35 PM

I also observed that for unallowed credits such as the Earned Income Credit (http://www.irs.gov/individuals/artic...=96466,00.html), it says that you must be a U.S. citizen or resident alien all year to claim it which makes it quite obvious that dual-status aliens cannot claim it.

However this is not the case with Making Work Pay Credit. Making Work Pay Credit only says that the term `eligible individual' means any individual other than any nonresident alien individual; and a dual-status alien is not a nonresident alien individual (and dual-status aliens who were resident aliens at the end of the year are actually now resident aliens only).

What do you think?

mayflo · Apr 5, 2011, 09:48 PM

Hi, I agree with crazee85. I'm dealing with the same issue and I read the same things you did. Pub 519 does not specifically say a dual status filer cannot take the making work pay credit. Also pub 519 does say that a dual status resident can claim most credits that a resident can claim with the exception of a few credits. I'm callingg the IRS tomorrow. Will let you know what they say.

crazee85 · Apr 11, 2011, 04:12 PM

Any updates??

I hd also called up IRS, and according to them, u need to be resident alien for the entire year to claim Making Work Pay Credit, and hence dual status aliens cannot claim this credit... they hd transferred to me the department handling tax credits... they just hd a list of questions to ask and they were basing their decision on that... the last question in that list was "were you a resident alien for the entire year in 2010?"... and if you answer no to that question, they said "you are not eligible to claim making work pay or govt retiree credit"... they were not ready to listen that ARRA code actually says that a non-eligible individual is a non-resident alien; and not that an eligible individual is a resident alien... also even being a dual-status alien, we are actually filing our taxes on f1040; f1040nr is just being used as a statement...

jagrover · May 8, 2011, 12:35 PM

Per Internal Revenue Manual NRA's can claim this credit only when filing Form 1040 with Form 1040NR as the statement. The MWPC is not allowed if filing Form 1040NR with Form 1040 as the statement.

crazee85 · May 12, 2011, 07:39 AM

Originally Posted by jagrover

Per Internal Revenue Manual NRA's can claim this credit only when filing Form 1040 with Form 1040NR as the statement. The MWPC is not allowed if filing Form 1040NR with Form 1040 as the statement.

Thanks jagrover.. what is your source of info? Did the IRS tell you this?? I hv already filed my income tax return without the Making Work Pay Credit... so don't want to file an amended return unless I am 100% sure...

crazee85 · May 12, 2011, 07:47 AM

Originally Posted by jagrover

Per Internal Revenue Manual NRA's can claim this credit only when filing Form 1040 with Form 1040NR as the statement. The MWPC is not allowed if filing Form 1040NR with Form 1040 as the statement.

Just found what you were referring to... nice find...
Internal Revenue Manual - 3.38.147 International Notices (Cont. 1)

3.38.147.9.8 (01-01-2011)
Making Work Pay and Government Retiree Credits

Dual Status -Taxpayer can only get the Making Work Pay Credit when Form 1040 is the controlling document. Dual Status taxpayers are eligible for Government Retiree Credit with either as the controlling document.

What do you suggest doing now?? Sending my amended tax return with making work pay credit included?? Should I include the printout of this page as a proof or something??

jagrover · May 12, 2011, 09:20 AM

I am always reluctant to file an amended return for the current year too soon after filing since your communication might cross paths with IRS communications. I made the same error (claimed MWPC when Form 1040NR was controlling) and the IRS sent a letter notifying of adjustment. No response was required. If your filing was for a client I would suggest advising the client that the client may receive a letter. If it was your own return I would wait at least 3 months before taking any action. A phone call might be all it takes to rectify the problem.

crazee85 · May 12, 2011, 09:59 AM

Originally Posted by jagrover

I am always reluctant to file an amended return for the current year too soon after filing since your communication might cross paths with IRS communications. I made the same error (claimed MWPC when Form 1040NR was controlling) and the IRS sent a letter notifying of adjustment. No response was required. If your filing was for a client I would suggest advising the client that the client may receive a letter. If it was your own return I would wait at least 3 months before taking any action. A phone call might be all it takes to rectify the problem.

I actually made the opposite error in my original tax return... did not claim MWPC when Form 1040 was the controlling document... I owed taxes to IRS, if I was not claiming MWPC; and they hv already cashed my check...

Should I try calling up IRS and talking about this?? Or should I wait for few months, and then file my amended return??

jagrover · May 12, 2011, 05:16 PM

Since your return has been processed you should submit a Form 1040X to obtain the additional refund. I don't think your situation can be handled with a telephone call.