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Help with 1st US tax return

Help with 1st US tax return

Old Feb 14th 2024, 7:17 pm
  #1  
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Default Help with 1st US tax return

Hi all,

As the title says, I'm completing my first US tax return, using the paid-for turbo tax software. Moved from the UK to California in April last year. I'd appreciate any thoughts on the following questions:
  1. I'm married to a US citizen. I came here on a J1 visa (research scholar), and I applied for a marriage-based green card last autumn. I understand that I can apply to file taxes jointly with my wife. Are there benefits/disadvantages to filing jointly rather than separately? (e.g., taking advantage of the UK/US tax treaty as a j1 scholar)?
  2. I understand the US tax year runs from January to December. I moved to the US in April. Do I need to/how do I declare my UK income from January to April? Will this be taxed in the US again?
TIA!
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Old Feb 15th 2024, 2:16 pm
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Default Re: Help with 1st US tax return

For the first year I recommend using a proper tax accountant who's familiar with UK and US rules. (I don't know if the paid tier on TurboTax meets this, but as you're asking Qs on here instead of to them, I guess not). It will cost a few hundred dollars but in my view it's well spent. They will work out the different ways your residence could be managed e.g. often there is a choice of being a full year US-resident or using split-year process. And they can tell you which is most advantageous.
Same with filing jointly with your spouse. Often it's best to do this, but individual circumstances differ so your accountant should calculate it both ways and tell you which is best.
There are also several different ways to manage the foreign income.
All-in-all getting an expert is a good option. If your situation is relatively straightforward then next year you can probably go it alone/with some common software.
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Old Feb 19th 2024, 8:27 pm
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Default Re: Help with 1st US tax return

The main thing you need to figure out is whether you were a resident alien or nonresident alien for 2023. You are a resident alien if you pass the Green Card Test or the Substantial Presence Test. You don't pass the Green Card Test. When you are in J1 status, other than as a J1 student, you are an "exempt individual" (i.e. days not counted in the Substantial Presence Test) as a teacher or intern, unless you had been an exempt individual for some part of 2 of the previous 6 years. Assuming you hadn't been in J or F status before 2023, you were an exempt individual for your days in J1 status in 2023. Assuming you maintained J1 status until the second half of the year, and you hadn't been in the US much in the previous 2 years, you do not pass the Substantial Presence Test for 2023 (i.e. days present in the US in 2023 + 1/3 days present in the US in 2022 + 1/6 days present in the US in 2021 >= 183 days). So by default, you were a nonresident alien for all of 2023. Nonresident aliens cannot file jointly.

In order to file jointly, you guys would have to elect to use the Nonresident Spouse Treated as Resident option, which would treat you as a resident alien for all of 2023, and require you to file jointly.

Treating you as a resident alien would mean that your worldwide income the whole year would be subject to US tax, whereas as a nonresident alien you would only be subject to US tax on your US income. You can use the Foreign Earned Income Exclusion to exclude US tax on the foreign earned income from before you came to the US, and you can use the Foreign Tax Credit to reduce some or all of the US tax on other doubly-taxed income. But you would have to report the income on your US tax to use the exclusion and/or credit.

Married Filing Separately has worse tax rates if there is a big difference between the incomes of the two of you. Married Filing Separately also cannot use the standard deduction, and has disadvantageous treatment for IRA contributions and other things.
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Old Feb 19th 2024, 9:30 pm
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Default Re: Help with 1st US tax return

Agree with your first year I would find a boutique CPA
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Old Feb 20th 2024, 3:41 pm
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Default Re: Help with 1st US tax return

Originally Posted by esq
I came here on a J1 visa (research scholar), and I applied for a marriage-based green card last autumn.
Off topic, but just confirming your J1 is not subject to Rule 212E, two-year residency requirement? Otherwise you won't be able to adjust without a waiver.
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Old Feb 20th 2024, 5:20 pm
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Default Re: Help with 1st US tax return

Originally Posted by newacct
The main thing you need to figure out is whether you were a resident alien or nonresident alien for 2023. You are a resident alien if you pass the Green Card Test or the Substantial Presence Test. You don't pass the Green Card Test. When you are in J1 status, other than as a J1 student, you are an "exempt individual" (i.e. days not counted in the Substantial Presence Test) as a teacher or intern, unless you had been an exempt individual for some part of 2 of the previous 6 years. Assuming you hadn't been in J or F status before 2023, you were an exempt individual for your days in J1 status in 2023. Assuming you maintained J1 status until the second half of the year, and you hadn't been in the US much in the previous 2 years, you do not pass the Substantial Presence Test for 2023 (i.e. days present in the US in 2023 + 1/3 days present in the US in 2022 + 1/6 days present in the US in 2021 >= 183 days). So by default, you were a nonresident alien for all of 2023. Nonresident aliens cannot file jointly.

In order to file jointly, you guys would have to elect to use the Nonresident Spouse Treated as Resident option, which would treat you as a resident alien for all of 2023, and require you to file jointly.

Treating you as a resident alien would mean that your worldwide income the whole year would be subject to US tax, whereas as a nonresident alien you would only be subject to US tax on your US income. You can use the Foreign Earned Income Exclusion to exclude US tax on the foreign earned income from before you came to the US, and you can use the Foreign Tax Credit to reduce some or all of the US tax on other doubly-taxed income. But you would have to report the income on your US tax to use the exclusion and/or credit.

Married Filing Separately has worse tax rates if there is a big difference between the incomes of the two of you. Married Filing Separately also cannot use the standard deduction, and has disadvantageous treatment for IRA contributions and other things.
Not sure if you are referring to this, but the OP does not seem to meet these criteria….

https://www.irs.gov/individuals/inte...come-exclusion
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Old Feb 21st 2024, 4:56 pm
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Default Re: Help with 1st US tax return

Originally Posted by tht
Not sure if you are referring to this, but the OP does not seem to meet these criteria….

https://www.irs.gov/individuals/inte...come-exclusion
The OP came in April 2023. Take the 12-month period from April 2022 to March 2023, and presumably the OP was outside the US for at least 330 days during that period.
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Old Feb 21st 2024, 6:00 pm
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Default Re: Help with 1st US tax return

Originally Posted by newacct
The OP came in April 2023. Take the 12-month period from April 2022 to March 2023, and presumably the OP was outside the US for at least 330 days during that period.
  • A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

but they are not a US Citizen or Resident Alien (if they are not resident)…
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Old Feb 21st 2024, 6:02 pm
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Default Re: Help with 1st US tax return

Originally Posted by tht
  • A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

but they are not a US Citizen or Resident Alien (if they are not resident)…
But if they use Nonresident Spouse Treated as Resident, then they become a resident alien for all of 2023.
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Old Feb 21st 2024, 6:21 pm
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Default Re: Help with 1st US tax return

Originally Posted by newacct
But if they use Nonresident Spouse Treated as Resident, then they become a resident alien for all of 2023.
I thought they were her was a J1 before, So not sure how they meet the 330 days….

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