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Tax allowance - Part Year

Tax allowance - Part Year

Old Oct 22nd 2018, 10:26 pm
  #1  
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Default Tax allowance - Part Year

Hey All,

I am looking for some advice around tax withholding in the US. I am based in California and arrived at the start of October. I have begun earning and was wondering the head of household tax allowance of $13,600 at 10% tax is this prorated to the beginning of my work Visa? I am trying to work out can I earn up to $13k at 10% before December?

Thanks for your help as always,

Tom

Last edited by TomTom1988; Oct 22nd 2018 at 10:29 pm.
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Old Oct 24th 2018, 10:31 pm
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Default Re: Tax allowance - Part Year

I can't answer your question but since nobody has replied I thought I'd at least give some pointers.

I think your question assumes you're going to file as a resident alien. Assuming you haven't lived in the US before your entry in October, you'll likely not meet the Substantial Presence Test and therefore file as a non-resident alien (i.e. form 1040NR), declaring only your US source income. In this case, you won't get the standard deduction and only one exemption (see https://www.irs.gov/individuals/inte...uring-your-tax). I can't answer your specific question but it seems 1040NR is not prorata.

This is on a federal level (IRS). California is different. For California, you're a part-year resident in 2018 (form 540NR) and there things are pro-rata (look at schedule CA).

Please post what you find so we can learn from your insights.

Since you did a company transfer, I'd hope your company is paying for some tax help.
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Old Oct 30th 2018, 12:18 pm
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Default Re: Tax allowance - Part Year

Definitely one for a specialist - not sure you will be able to file as Head of Househokd Household after only 3 months in the US, and meet the requirement to have provided at least 6 months of financial support to a dependent. Depends if they permit your life overseas to be part of that equation or not.
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Old Oct 30th 2018, 2:02 pm
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Default Re: Tax allowance - Part Year

In the absence of definitive responses, you can either seek professional help or look up IRS Publication 519. As indicated above, your first real question is not really related to dollars and tax rate. Instead you need to identify whether you are resident, non-resident, or dual status for taxes. Everything else flows from there.

Most folks don’t bother reading pub 519 because it is very long. But it is an extremely useful guide to navigating these issues - there are many exceptions and exceptions to exceptions that only apply in specific cases which makes it hard for people on the forum to provide specific answers.
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