[lalalaolala]

Hi,
My situation is a little complicated so I need some help for my 2011 tax filing.
I came to the States in 2005 on F1 visa and worked for 1 year (2009-2010) on OPT. Since July 2010, I am on another F1 visa for graduate school. I also bought a condo in April, 2010.
1)since I have been in the States for more than 5 years, I think I am considered a resident Alien starting 2011, so I am eligible for the $8000 tax return. I guess I should also file 1040.
2) I also have salaries (on OPT) from Jan 1st 2010 to April 2010, which should be also filed (with 1040)
3) I became a student from July 2010 to till and receive stipend (I don't work for the school, it is just a scholarship/stipend/fellowship)
4) Finally, even though I am a resident alien, I think there is a "saving clause" rule, which states that even after you become a resident alien, you can still get exemptions from your scholarship)
See: onresident Alien Who Becomes a Resident Alien

Generally, only a nonresident alien individual may use the terms of a tax treaty to reduce or eliminate U.S. tax on income from a scholarship or fellowship grant. A student (including a trainee or business apprentice) or researcher who has become a resident alien for U.S. tax purposes may be able to claim benefits under a tax treaty that apply to reduce or eliminate U.S. tax on scholarship or fellowship grant income. Most treaties contain a provision known as a "saving clause." Exceptions specified in the saving clause may permit an exemption from tax to continue for scholarship or fellowship grant income even after the recipient has otherwise become a U.S. resident alien for tax purposes. In this situation, the individual must give the withholding agent a Form W-9 (PDF) to claim his treaty exemption and an attachment that includes all the following information

Now if I understand correctly, I am a resident alien who is still eligible for tax exemptions, and the tax exemptions states that 1)students do not pay tax on schorlarships (or money that you didn't have to work for) 2)for the money that you worked for, first $5000 of it is tax free.

So the dreamy situations for me would be.
1) I get the $8000 tax credit because I am a resident alien.
2) I don't have to pay tax on the first $5000 of the money I got during OPT from Jan to April 2010 (I was employed and worked to get my salary)and pay tax for the rest of money that I made.
3) I don't have to pay any tax on the stipend I earned from my school from July 2010 till now, because it is a stipend that I didn't have to work for.

Am I just dreaming? How do I file tax for my situation?
Thanks.

[lalalaolala]

Sorry the title should have been "Resident Alien"
And I am a Chinese citizen.

[AtlantaTaxExpert]

Okay, to begin with, you were a resident alien starting on 1 January 2010, NOT 2011.

Stipends that require no work are generally tax-free regardless of your status as a resident or non-resident alien, so you should ask the university if THEY consider it to be tax-free or not.

You ARE eligible for the $5,000 treaty exemption authorized under the U.S.-China Tax Treaty, even if you file as a resident alien, though you will need to file Form 8833 to cite the tax treaty to claim the exemption.

The only $8,000 credit that I am aware of is the First Time Home Buyer's Credit. As a resident alien starting on 1 January 2010, you ARE eligible IF you BOUGHT a house or condominium in 2010, provided you met certain deadlines of when you were under contract and when you finally closed on the home. If you buy the home in 2011, there is NO $8,000 credit.

If you need professional help to file, email me at [email protected] for a fee quote.

[lalalaolala]

Thanks so much AtlantaTaxExpert.
Yes I did buy the condo in 2010 and meet all the deadlines about contract and closing. So I think I am eligible for the $8000 first time buyer credit.

If the stipends (that required no work) is tax free, should I even file it at all? With what form? 1040?

I also found that the standard deduction for US citizen is actually $5800 which is more than the $5000 I get from being Chinese citizen. Does it mean that actually it is better for me to not claim the $5000 at all. Or can I use both $5800 and $5000, which is $10800 all together?

p.s. Is my situation too complicated for turbo tax to handle?

Thanks so much again.

[AtlantaTaxExpert]

Yes, you need to file Forms 1040 and 5405, in order to get the $8,000 credit, which is a REFUNDABLE credit (meaning you get the $8,000 credit even if you owe NO income tax).

As a Chinese student still on F-1, but filing as a resident, you get BOTH the $5,700 standard deduction AND the $5,000 treaty exemption.

Yes, you will NOT be able to file using Turbo Tax, because Turbo Tax will NOT have Form 8833 as one of the forms on its listing. Further, since Form 8833 must be filed with the Forms 1040 and 5405, the return will HAVE to be mailed; filing electronically is NOT an option.

Again, if you need professional help to file, email me at [email protected] for a fee quote.