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ankitarora13 · Mar 3, 2008, 12:09 AM

Hi,
I came to US in California state on L1B visa on 7th Oct 2007 and my wife moved in here after a week.

Now for filing return for 2007, what all forms I need to fill.
My company has given me the W2 form, which has all the details about the taxes and wages paid.

As per my understanding, I need to appy for my wife's ITIN. My Status would be married filling jointly.
I need to fill W7 form for my wife's ITIN and need to attach the same with the main form.
MY QUERIES :
1. For federal tax return which form should I fill, i.e. 1040 or 1040NR EZ??
2. For California State Tax return file, which form should I Fill i.e. 540NR or 540 2EZ.?

3. Do I need to fill two separate w7 forms to be attached with both federal tax return and State tax return?

Looking forward for some guidance.

Regards,
Ankit

MukatA · Mar 3, 2008, 12:19 AM

Choice 1: You can file resident tax return as Married Filing Jointly. You will have to wait for 5 months to file your tax return till you meet the Substantial Presence Test (of 183 days) in 2008. You will get standard deduction of $10,700 and exemptions for both of you. You must both declare your worldwide income for 2007. If you have any foreign income, and on that income you paid taxes in the foreign country, then you can claim foreign tax credit.

You will complete forms W7 (application for ITIN) for your spouse and attach with your tax return. You can also deduct moving expenses. Use form 3903.

Choice 2: File nonresident tax return. You will only get exemption deduction of $3,400 and moving expenses, which includes air fair for both of you.

ankitarora13 · Mar 3, 2008, 12:43 AM

Originally Posted by MukatA

Choice 1: You can file resident tax return as Married Filing Jointly. You will have to wait for 5 months to file your tax return till you meet the Substantial Presence Test (of 183 days) in 2008. You will get standard deduction of $10,700 and exemptions for both of you. You must both declare your worldwide income for 2007. If you have any foreign income, and on that income you paid taxes in the foreign country, then you can claim foreign tax credit.

You will complete forms W7 (application for ITIN) for your spouse and attach with your tax return. You can also deduct moving expenses. Use form 3903.

Choice 2: File nonresident tax return. You will only get exemption deduction of $3,400 and moving expenses, which includes air fair for both of you.

Thanks for you reply. I still have some doubts.

FYI. Moving expenses were paid by the company, as it was the company transfer from India.

I still have some doubts,
In 2007, I got the Salary in US only from 7th Oct till 31st Dec 2007. For which I have already paid taxes like Federal Income Tax, State income Tax, Social Security Tax, Medicare tax, etc..
As per my understanding, as the amount was not enough( around 15,000$) so, I should get the refund of the taxes paid like Federal Income tax and State Income tax.
1. Do I need to wait (for Substantial Presence Test) to file the return and to get these refund of taxes or I can file the return with relevant forms right away?
2. What all forms I need to fill ?

Looking forward for your reply. Thanks.

MukatA · Mar 3, 2008, 12:18 PM

W2 shows your total income and amounts withheld for various accounts (SE tax, federal tax, state tax... ). IT IS NOT YOUR TAX RETURN.

2. You will need to file your federal and state income tax returns by April 15, 2008. The returns will show your total income (from W2) and your total federal and state taxes on that income.

3. Now if on W2 you paid more federal taxes than your federal tax liability as per your return, then you will get a refund. If on W2 you paid less federal taxes than your federal tax liability as per your return.

ankitarora13 · Mar 3, 2008, 09:03 PM

Thanks for the Information. My Question is still unanswered.
As I told earlier, that I moved in US on 7th Oct 2007. So, as per your previous response I need to wait till I finish 183 days, which would be on or around 8th April 2008.
So, I think, I can file the return on 8th April or so. Now, I am still not clear about the ITIN for my wife. As, I need to file two returns i.e. Federal and State. While filling Federal tax return, I will attach the W7 form for my wife's ITIN.

How I will file the State Tax return without the ITIN?? Or do I need to wait for the ITIN to come from Federal and then file the State Return.
Do I need to apply for the extension for the State Tax return( I am expecting the refund)?

Please advice.

ankitarora13 · Mar 6, 2008, 10:38 PM

Looking forward for some advice from the experts.

MukatA · Mar 7, 2008, 04:56 AM

For SPT test in 2008, you will count only 1/3 of days in 2007.
You will file your state tax return only when you get ITIN. Meanwhile apply for an extension.

nileshcentury · Mar 7, 2008, 08:21 AM

You can not use days in 2008 to rove substantial present test for tax year of 2007. If you have not completed 183 days od stay in US (all days of 2007 + 1/3 of 2006 + 1/6 of 2005) then substantial presnce test is not passed. So you have to go for 1040NR-EZ (if you are single and no dependent).

nileshcentury · Mar 7, 2008, 08:41 AM

Also, your standard deduction will be same as residents if you are from India. (thanks to US-India treaty). So you will not loose any money. Only thing is that you have to mail your form and W-2 as online option is not available for non-residents (tax purposes). But next year, if you pass substantial presence test, you can file online.