[SarangP]

I came to USA on 15th Nov 2009. I wanted myself to be treated as resident alien for tax purposes.

I filed for automatic extension and now that I have passed the SPT for 2010, it's a good time to file for my taxes.

I now have multiple questions in my mind.
1. I have prepared form 1040 and W7 for my Spouse's ITIN (She is not elligible for SSN). Is it correct?
2. Do I need to attach any other document such as my spouse's passport photo copy?
3. The Pub 519 says that I need to prepare a statement to make first year choice. I assume that it doesn't have any standard format and that I can write the required info on a plain paper and attach it to Form 1040 and W7. Is it correct?
4. I am filing tax returns in my Home Land as well for the income I earned before coming to USA and so I am not showing any foreign earned income while filing taxes in USA. Is it fine?

Appreciate your guidance.

[AtlantaTaxExpert]

SarangP:

1) Correct, though Form 1040EZ or 1040A can be used as well.

2) The photocopy of the passport PICTURE page must be notarized; this can be done at your local bank in most states (except California; there you need to go to the IRS to get the photocopy certified).

3) Correct. State that you meet the criteria for filing jointly and that you CHOOSE to be treated as resident aliens for all of 2010.

4) No, that is NOT correct! By filing jointly with your wife and choosing resident status for the entire year, ALL world-wide income earned in 2009 becomes subject to U.S. income taxes. Since you paid income taxes in your home country, you can file Form 1116 to claim the Foreign Tax Credit, which should offset most, if not all, of any extra tax you would owe. If you file Form 1116, you must file Form 1040. On the state tax return, declare ONLY income earned within that specific state since 19 November 2009.

[MukatA]

SarangP:
Which visa do you have? Why do you want to file resident return?
On nonresident tax return you will show U.S. income received during 2009. You can also claim moving expenses Form 3903.

[SarangP]

Thanks for the reply AtlantaTaxExpert and MukatA.
Appreciate your guidance a lot.

MukatA: As mentioned above, my visa is H1 and my wife is on H4. I want to go with resident alien for getting better tax benefits. Although my earnings in last year (15 Nov 9 to 31 Dec 09) are very low, if I file as non resident alien, I don't get the full refund. I can get it only in resident alien case. Am I missing something which I should be aware of?

I guess things are not as simple as they look for filing taxes in USA :-(

ATE and MukatA, what do you suggest me to do? Shall I file as a resident alien or non resident alien?
I want to have my wife's ITIN as well done this time. Will non resident alien status cause any problem?

[AtlantaTaxExpert]

In 95% of the cases I deal with, filing jointly with your wife almost ALWAYS produces the best result tax-wise, even if you have to declare your home country income on the return.

Your case MAY be on the 5% in which it does not work out for you, but that is unlikely.