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elango_m · Jul 8, 2011, 07:23 AM

Hi,

I am filling my H1B visa (documents got approved and waiting for the consulate interview).
I am planning to travel on 01-Oct-2011 and my wife will be joining with me in Novemeber as H4 dependent. I am planning about my tax calculation so that I can estimate my savings in US. Also this is the first time I am reading about the US tax system and your advice will be great info. My questions are:

1) Which is the best way of filling tax,so that I can save more money?

2) When should I fill the tax for my earnging from 1-Oct-2011?

3) I read that, I need to pass substanial presence test (SPT) for qualifying the tax filling as "Married and Filling Jointly". I will be in US from Oct 2011 and based on the SPT test condition I am not crossing the cutoff - 183 days (Mine was just 155days). Can I wait till I meet the condition and fill the tax,so that I can save more money from tax? Please advice the best way.

Thanks in advance for the clarification.

Thanks
Elango M

AtlantaTaxExpert · Jul 8, 2011, 07:36 AM

More than likely, you should file jointly with your wife and you both CHOOSE to be treated as resident aliens. This will allow you to claim your wife's personal exemption, claim the joint standard deduction, qualify for the $800 Making work Pay Credit, and be taxed at the lower joint tax rate. You will also need to submit Form W-7 with the tax return to get your wife an Individual Tax Identification Number (ITIN).

The downsides are that you must declare ALL income earned in 2011 (to include your and your wife's home country income), but this can be mitigated by filing Form 1116 to claim the Foreign Tax Credit. Further, you must WAIT until 1 June 2012 to file in order to qualify undet the Supstantial Presence Test.

You will also file the state tax return jointly, but there is NO waiting requirement and you need only declare the income earned since 1 October 2011 on the STATE tax return.

The alternative is to file as a non-resident alien, claiming ONLY your own personal exemption and paying taxes (under the Married Filing Separate tax rates) only on the income earned since 1 October 2011.

If you need professional help to file your return next year, email me at [email protected]. This IS what I do!

elango_m · Jul 11, 2011, 03:58 AM

Thank you for the quick reply!

AtlantaTaxExpert · Jul 11, 2011, 05:45 AM

Glad to help!

elango_m · Jul 29, 2011, 06:53 AM

Hi,

I am currently in india and I got my onsite salary info: I am going to get the below as my annual salary (from October first onwards):

Annual Gross= 70698
Performance Bonus= 5302

Total CTC(cost to the company)= 76000

The place where I am going to shift is California (San jose).Can you please let me know how much I would be paying as Tax? Is there any tax difference on gross salary and bonus? Myself and my wife will be coming to US. My spouse will be in H4 and will not work there. If you can give me approximate tax which I have to pay (with the both the cases: married and joint filling, single filling), then that would be a great help to see my savings.

Thank you

AtlantaTaxExpert · Jul 29, 2011, 09:02 AM

Just answered via email