[kris31]

Hi all,

I was a resident (F1-student) of US until the end of June 2008 and then I left for Canada for a job. I was a US resident for tax purposes for years 2006 and 2007. Since I did not reside in US for 183 days in 2008, I think I am considered a resident until end of June and a non-resident from July ("dual-status alien"). I am married and my wife was also a resident for tax purposes for years 2006 and 2007. I have a child who was born in March 2008 in US.

Now, I've got my w-2's and I am trying to figure out the taxes. I have several questions:

1) From what I've read on IRS.gov, I need to file forms 1040 and 1040NR. Do I need to provide any other form (ex: 8840) to IRS? Do my wife and myself have to provide a letter saying that we left the US on a particular date ("residency termination date")?
2) Myself and my wife have to file "married filing separately", right?
3) Do I need to only fill 1040 and leave the 1040NR blank since I did not get any US income when I was a non-resident?
4) What deduction can I make? Can I include hospital expenses for my child birth, insurance payments, etc as itemized deductions? Is it correct that I cannot claim standard deduction ($3000? ) under dual status?
5) Can I claim my wife (who worked for 2 months) and child as dependent?

Any help will be greatly appreciated. Thank you all.

[MukatA]

When did you enter the U.S. on F1?
How did you conclude that you were resident for 2006 and 2007?
Read about F1 tax filing: Your U.S. Tax Return: The U.S. Visas

[kris31]

I entered the US in 2001, so I became resident for tax purpose in 2006 and 2007. Since I left the US within the 183 period in 2008, according to the IRS website, I am considered a non-resident for tax purposes. As I was a resident for part of the year and a non-resident for later part of the year, I am a dual status person. Thank you.

[AtlantaTaxExpert]

1) You are dual-status. The dual-status tax return will serve as your termination notice, as you provide your exit date on the Form 1040NR.

2) No; you can claim your wife and child as dependent if they have no U.S.-soruced income. If your wife does have U.S.-sourced income, then she needs to file a dual-status return as well.

3) The Form 1040NR (you can use use 1040NR-EZ as well) provides demographic data plus information about when you left the U.S.

4) Yes, you CAN claim the medical costs on the normal Schedule A that is attached to the Form 1040. No, you CANNOT claim the $5,450 standard deduction.

5) As noted above, you CAN claim the child as your depentent, but not your wife. She has to file her own dual-status return.

It is my belief that a dual-status return is not a return for an amateur! You should professional tax help by someone with experience filing dual-status returns.

[kris31]

1) You are dual-status. The dual-status tax return will serve as your termination notice, as you provide your exit date on the Form 1040NR.

2) No; you can claim your wife and child as dependent if they have no U.S.-soruced income. If your wife does have U.S.-sourced income, then she needs to file a dual-status return as well.

3) The Form 1040NR (you can use use 1040NR-EZ as well) provides demographic data plus information about when you left the U.S.

4) Yes, you CAN claim the medical costs on the normal Schedule A that is attached to the Form 1040. No, you CANNOT claim the $5,450 standard deduction.

5) As noted above, you CAN claim the child as your depentent, but not your wife. She has to file her own dual-status return.

It is my belief that a dual-status return is not a return for an amateur! You should professional tax help by someone with experience filing dual-status returns.

Thanks Atlanta Expert for your very useful reply for my previous post. You are doing a great job helping foreign tax filers. In my situation, I thought I need to file form 8840 to claim exemption under closer ties to a foreign country. But since I am a dual status person and I am technically a non-resident after I left the US, I need not file that form, I think. I have a question on my wife's taxes. Can she claim an exemption for herself (line 6a form 1040) for $3500? Her total income in US was about 5K for 2008. Also, another question. Is there a penalty for late filing? I remember reading somewhere on IRS.gov that for foreign tax filers not in US, the deadline is June 15. Is that right? Thank you very much.

Kris

[AtlantaTaxExpert]

Kris:

If you have a refund coming, do not worry about the 15 April 2009 filing deadline.

Your wife CAN claim her own $3,500 personal exemption on her dual-status return.

No Form 8840 is required if you file dual-status.