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sharathmsc · Feb 10, 2006, 09:15 AM

Hi All,
I need little help regarding tax filing.
Here are my details:
Came to USA on F1 in aug 2002;
Graduated in Dec 2004 and my Opt start from DEC 25TH 2004;
My H1 Started in Dec 5th 2005.

I filed 1040NREZ and 8843 for 2004 period.

For year 2005, for 11 months, am on OPT and for 1 month I am on H1B.
So I think I am in dual status. Please confirm me.

I think I pass the substantial presence test
2002-143 days,
2003-362 days,
2004-231 days, (jan -may went to home country)
2005-365 days,

Recently I contacted IRS they said I need to file 1040 NR EZ and 8843 for 2005 too.
But one of my friend says on dec 31 2005, You are on H1, so you are considered as resident so fill 1040 normal form.

I have following Questions:
1) Which forms I need to file in 2005?
2) I am a resident or non-resident?
3) In Jan 2005, I met with an accident and hospitalised for 2 weeks, I have insurance so it covered most of it. But from my pocket, I paid around 2000-3000$, Can I claim this during tax returns and get any benefits?

I appreciate if you clear my doubts regarding.

Thanks a lot in advance.

AtlantaTaxExpert · Feb 10, 2006, 10:37 AM

Sharathmsc:

You are technically dual-status, but if you filed as a non-resident alien (Form 1040NR/1040NR-EZ and Form 8843), the IRS would probably accept the return without question because the time you spent on H-1 is so short (less than 30 days).

You do not meet the Substantial Presence Test. The time (up to five years) you were under the F-01 visa does not count towards the Substantial Presence Test.

Sorry, medical expenses cannot be deducted from a non-resident tax return. Even if they could, the deduction would be limited only to amount that exceeds 7.5% of your Adjusted Gross Income, and then only as an itemized tax deduction.

sharathmsc · Feb 10, 2006, 11:50 AM

Hey I couldn't get that Medical expenses thing, Can u be explain little more on that, Please.
I mean how to brief those expenses in Itemized deductions.
Thank you.

AtlantaTaxExpert · Feb 10, 2006, 11:00 PM

Okay, let's assume your Adjusted Gross Income is $50,000 and let's assume that you can already itemize even without the medical expenses.

To be able to itemize your medical expenses, you must exceed 7.5% of your AGI. In our sample case, that's $3,750. If your total medical expenses for the year was only $3,725, your itemized deduction would be zero!

If, however, your total medical expenses was $5,000, you could deduct $1,250 as an itemized deduction.

Hard to explain, but simple to show as an example!