How to claim the US-China tax treaty?

[bigbear666]

Hi experts, I am a resident alien from California, I followed the above steps to enter a $5000 income adjustment for my federal income. Though the adjustment automatically applied to the state income,  though it is unavailable in California, how do I adjust the amount for state income? Can I simply add $5000 "other adjustment to wages" to my state income as follows:

[ErnieS0]

The California section includes an add back for income exempted by treaty @bigbear666.

1. Continue until you see Here's the income that California handles differently.
2. In Wages you will see Income Exempted by U.S. Tax Treaties
3. Start and enter $5,000 on Enter Income Exempted by U.S. Tax Treaties

[bigbear666]

thank you, Ernie, I think that's exactly what I am looking for!

[bigbear666]

Hi Ernie, 

I have one more question regarding mailing the tax return. 

Currently, I have:

1 form 1099-B for stock income

2 forms of W-2 from the employer 

1 form 8833 for US-China tax treaty

So, what forms should I attach when mailing the federal tax form?

And what forms should I attach when mailing the California state tax form?

[DaveF1006]

It depends. Here is a guideline that the IRS has published. In this instance, only the W2 should be mailed with the return. This is the same for the state of California.

As a guideline for both, you will send in any tax document that shows that there was federal or state tax withheld. For an example, if your 1099 B shows either a federal or state tax withheld, you would send that in also. It is very rare that this happens though.

After you finish your return, Turbo Tax will give you complete filing and mailing instructions for both returns if you are submitting by mail.

@bigbear666

[bigbear666]

Hi dave

This is the instruction I get from turbo tax, it asks me explicitly not to include W-2 forms for the state tax return, should I follow that instruction?

[RobertB4444]

@bigbear666  You should follow the TurboTax instructions and include a complete copy of your federal return with your California return in place of your W-2s.

[sophy]

03-15-2022. Need to upgrade to the deluxe version. IRS accepted my e-file with the 5000 US-China tax treaty. Do I still need to mail it?

[DaveF1006]

No, you shouldn't need to mail it unless Turbo Tax gave you specific instructions to mail in specific forms. If no instruction exists, then you do not need to mail. 

@sophy

[chenn3]

If I wanna claim the China-US tax treaty benefits, can I still e-file my state return via Turbotax Premier? Or does the state tax also need to be printed out and mailed?

[DaveF1006]

According to this Turbo Tax article, it is no longer possible to e-file your state if your federal return was, or will be, paper-filed. If you wish to file using the treaty exclusion, you will need to file a 8833, which Turbo Tax does not support for efiling. You will need to mail in both the federal and state returns. Please read this Turbo Tax post  written by ReneeM7122 for more details.

@chenn3 

[rasfjba]

I don't see the option for Alabama. Is that handled differently? 

[DaveF1006]

No. The tax treaties make no provisions for state income tax considerations but Alabama will use the AGI amount reported in the federal return, which reflects excluded federal treaty income. The states do not reap an extra benefit.

@rasfjba

[sophy]

I e-flied mine the deluxe version. IRS accepted my e-file with the 5000 US-China tax treaty.

[sophy]

I e-filed mine by just entering the -5000 as instructed without the 8833, but IRS accepted my e-file, leaving me not able to mail the tax return.