[mrnd23]

Hi,
I entered the US in 08/2005 on F1 visa. I started working on F1-CPT fulltime from 05/07 - 12/07 (7 months) and then worked on F1-OPT (after graduation) from 12/07 - 09/08 and then from 10/08 to current date on H1B work visa. I have so far been using 1040NR for my tax return.

Please help me in understanding which form I need to fill now.
In the above time I have been outside the US for a trip to India for around 50 days total in 2007 (2 separate trips).

[MukatA]

If you are single and you did not complete SPT during H1-B period, so you can only file non-resident tax return. You will also file Form 8843 for OPT period.

On your OPT income you will get deduction based on tax treaty between the U.S. and your country. Since you are from India, as per tax treaty, you will claim standard deduction of $5,450 instead of itemized deduction.
Read: Your U.S. Tax Return: U.S. Tax Filing Requirements for Non-Residents

[mrnd23]

Hi MukatA,
Thanks for your reply. How can I show OPT period earnings separate from H1B period earnings in the same form 1040NR and claim separate deductions.

Also for jan 07 - dec 07 returns I filed just 1040NR and no 8843. My status during that year was: I worked partime on capus in my univ as a F1 student. I was on F1-CPT from 05/07 - 12/15/07 (Exact date) n then my OPT period began. Do I need to file 8843 for last year.

[AtlantaTaxExpert]

Prorating the income between OPT and H-1B time is basic math, but it is NOT necessary. Claim all of the 2008 income on Form 1040NR or 1040NR-EZ as a non-resident alien!

Filing a dual-status return has no tax advantages, takes a lot of time to prepare, and requires you wait until June 2009 to file for NO GOOD REASON!

Yes, you need to file Form 8843 for BOTH 2007 and 2008. Mail the signed 2007 Form 8843 in immediately. File the 3008 Form 8843 with your 2008 non-resident tax

[mrnd23]

Prorating the income between OPT and H-1B time is basic math, but it is NOT necessary. Claim all of the 2008 income on Form 1040NR or 1040NR-EZ as a non-resident alien!

Filing a dual-status return has no tax advantages, takes a lot of time to prepare, and requires you wait until June 2009 to file for NO GOOD REASON!

Yes, you need to file Form 8843 for BOTH 2007 and 2008. Mail the signed 2007 Form 8843 in immediately. File the 3008 Form 8843 with your 2008 non-resident tax

Hi ATE, thanks so much. That does help a lot. But it also makes me ask another question.
When I filed the 1040 NR last year I did not put in the tax treaty exemption for the India US tax treaty. How can I correct this? Is the tax treaty deduction supposed to filled in the itemized deduction line?
Also in the 1040 NR form I see that line 22 asks total income exempt from tax treaty. However I tried to follow the form through but don't see any place where this income is deducted to get a new total taxable income. Line 22 also askes to fill page 5 item M which does ask for details of the tax treaty which I understand but do not see how this exemption is deducted.

[AtlantaTaxExpert]

I have had the IRS question the standard deduction on Form 1040NR and 1040NR-EZ because I failed to put the notation on the dotted line next to the standard deduction claim.

But it does not happen too often, because most IRS personnel know the rules, and they can determine that the taxpayer is an Indian student on a F-1 visa based on the information on Page 2 of the Form 1040nR-EZ or page 5 of the Form 1040NR.

As an Indian on F-1, line #22 does NOT apply to you, because your treaty exemption is the standard deduction. I normally cite this fact on Item M of page 5, but it is NOT required if you put the appropriate notation on the Itemized Deduction dotted line.

[mrnd23]

I have had the IRS question the standard deduction on Form 1040NR and 1040NR-EZ because I failed to put the notation on the dotted line next to the standard deduction claim.

But it does not happen too often, because most IRS personnel know the rules, and they can determine that the taxpayer is an Indian student on a F-1 visa based on the information on Page 2 of the Form 1040nR-EZ or page 5 of the Form 1040NR.

As an Indian on F-1, line #22 does NOT apply to you, because your treaty exemption is the standard deduction. I normally cite this fact on Item M of page 5, but it is NOT required if you put the appropriate notation on the Itemized Deduction dotted line.

Hi ATE,
So if I am understanding this right I can include the tax treaty exemption amount in itemized deduction line 37 and just mention on the dotted line that it's the tax treaty exemption? If this is so, how can I correct the fact that I didn't put this exemption in my returns from 07 and overpaid on my taxes? Do I fill a new amended 1040NR form for 2007? Also itemized deductions line 37 asks me to fill schedule A for. Should I mention the tax treaty anywhere in schedule A?

Just FYI I filed 1040NR instead of 1040NR EZ for 07 because I ahd moving expenses and student loan interest payments exemptions that I needed to add. This year however I have no exemptions to claim except for the treaty and personal exemption. Is it better to file 1040NR EZ?

[mrnd23]

Another FYI - the only deduction I claimed in my 2007 itemized deduction schedule A form is my IL state taxes. I do not know if the moving expenses and student loan interest deductions are considered as itemized deductions. If you could explain what exactly comes under an intemized deduction that would be great.
I checked that if I had taken the tax treaty exemption I would have received a far larger refund ( I actually ended up paying $200 last year). Please suggest how I can correct my last year's 1040NR form to add the tax treaty exemption.

[AtlantaTaxExpert]

Mrnd23:

If you did not claim the standard deduction on your 2007 return, you can and should amend the return using Form 1040X and attaching a properly-prepared Form 1040NR to the Form 1040X with the word 'AMENDED' printed on the top of page #1. You need to use Form 1040NR because you must include the moving expenses previously claimed.

The moving expenses and student loan interest are NOT itemized deductions; they are adjustments to income claimed on Page #1 of Form 1040NR.

If you need professional help filing this amendment, contact me at [email protected].