[USBound]

Hello -

In 2007 I moved to the US from Canada with my family (we are all Cdn citizens).

For 2007, I do NOT meet the substantial presence test, as I don't have a green card, and don't satisfy the 183-day rule.

Assumptions -

1. Having severed all residential ties with Canada upon moving to the US, my Canadian residency ends on the date of my family's move to the US. This liberates me of Canadian tax obligations on income earned after my departure from Canada :D.

Questions -

1. Can I (... and if yes, should I) be treated as a resident for tax purposes in the US ? I've heard of a first year election one can take when entering the US, but don't know if it applies to me. If I can make such an election, should I?. or is it more advantageous to be treated as a non-resident taxpayer for 2007. (I have no other income, other than that paid to me by my employer).

2. Can I file "married filing jointly" ? What would I need to do to make this possible ? I would like to be able to take advantage of the higher personal exemptions associated with this filing status, but am not sure I can.

Help would be appreciated !

[MukatA]

Choice 1: File nonresident tax return. You will get only your own exemption and itemized deductions. You can claim moving expenses for the family.
Read: Your U.S. Tax Return: Moving Expenses

Choice 2: After you meet SPT in 2008, file joint return as residents. You will get standard deduction of $10,700 and exemptions for both of you and the kids.
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 children and attach with your tax return. You can also deduct moving expenses. Use form 3903.

[AtlantaTaxExpert]

Also without exception, filing jointly and choosing to be treated as a resident alien is the BEST choice.