[shamindra74]

Hi, can married nonresident alien (NRA) file jointly and if so, which form should it be?

I was in F1 till aug 07 and then the remaining 4 months in H1B. My stay in US as F1 doesn't contribute towards substantial presence test since it was within the first five calendar years of being F1 (see The Closer Connection Exception to the Substantial Presence Test for Foreign Students). Obviously, 4 months of H1B cannot exceed 183 days. So, am an NRA.

My wife was in F1 for the full year and her stay was also within the first five calendar years of being F1. So, she is also an NRA.

I searched a lot (irs.gov, general googling, etc) about how a married NRA couple can jointly file and finally found from IRS.gov that we CANNOT (see Nonresident Alien - Figuring Your Tax). By the way, we both are from India.

I found many websites / forums suggesting to file 1040 as RA; in fact, some of my friends in similar situation, did file using 1040 as RA and already got back their refund and they all went through lawyers. Am I missing something? Since, on one hand, the tax-lawyers advise people like us to be RA but IRS clearly ruled out that possibility in the above-mentioned website. If anyone could help me out, that would be great.

[AtlantaTaxExpert]

You can file jointly with your wife and you both CHOSE to be treated as resident aliens. This will allow you to claim the $10,700 joint standard deduction plus two $3,400 personal exemption (for yourself and your wife).

The downside is that you must declare ALL 2007 world-wide income. There are two offsets available, by either claiming a Foreign Tax Credit (Form 1116) or a Foreign Income Exclusion (Form 2555).

Even with the downside, this is probably the best way for you to file.

The procdure outlined above is detailed in IRS Pub 519.