@Anonymous , generally your understanding is correct , except for the following ( and this is a correction on my earlier statements ( above).
1. for purposes of the first year choice, the term always used is "resident for the year ". However , the definition of when the year begins is not always clear . In most cases it is the first full day that you are present in the US for any reason.
2. In your case , it usually is the earliest 31 day test period -- if you are present say from Jun 1st through Aug 15th , left USA thereafter and came back in Sept for the rest of the -- You could use two test period to meet your 31 day ( stayed here for at least 31 days) and usually your start of the tax year for "resident would be June 1st till the end of the year.
3. In your case I also erroneously assumed that the five year exempt status was somewhat malleable in that you as the beneficiary can choose to use it or ignore it if it to your advantage. In this last I was WRONG. I did a lot of search to find if the use of exempt status was mandatory i.e. did they use "may / can / should " etc. or"must, shall "etc. Well to my horror ( and surprise ) the term used in 26CFR 301.7701 the term used is "shall be excluded and will not count ". referring to the days an exempt person is present in the united states.
4. Why is this important ? It is because I assumed that you could start your resident yer from 1st of Jan ( as it is to your advantage for use of "standard deduction " for joint filing. Since 3. above clearly says you do not have a choice in counting or ignoring the exempt status, that avenue is blocked. Thus even when filing jointly , you do not get to use the standard deduction ( even though there is no reference to this ) because you will be treated as dual status person and therefore itemized deduction is the only path forward.
I apologize for my error ( and I learnt something out of this exercise -- thank you )
adios
pk
