Standard Deduction for F-1 Student

[ng92]

Hi,

I am an international student from India on an F-1 visa in the US. I am reviewing my 2022 return and have a query about the standard deduction under the US-India income tax treaty.

In 2022, my spouse was on an L-1 visa, and I was on an F-1 visa. Both of us were non-resident aliens for US tax purposes and filed 1040-NR. She claimed an itemized deduction on her return for the withheld state taxes. Under the US-India income tax treaty, I claimed the standard deduction. IRS Publication 519 mentions the following

I would like to understand if I was not eligible to take the standard deduction and incorrectly claimed the standard deduction on my 2022 tax return.

Thank you!

[Vanessa A]

The rules for the 1040NR can be different than the rules for the form 1040.  TurboTax does not cover the form 1040NR.  You could contact Sprintax.com to get a good answer on filing status and deductions as a non resident alien.

In general, for those filing a form 1040 as a US Citizen or Resident Alien, both must either itemize or take the standard deduction.  One cannot itemize while the other takes the standard deduction.  

[pk]

@ng92 , generally agreeing with my colleague @Vanessa A ,  the US-India Tax treaty does allow standard deduction for students on F-1 from India  but it stipulates this in a round about way -- It wants India students to be treated same as American and/or resident for tax purpose students.

Therefore  it is a matter of interpretation on how to proceed  i.e.  America/Resident students   with filing status of Married Filing Sep ( equivalent to F-1 married students  form 1040-NR )  have the additional restriction of both taking the same type of deduction.   My interpretation of the situation is that since one spouse is filing  with itemized deduction, the other spouse must also follow suit .

Others may disagree with my strict interpretation  of the intent of the law.  

Is there more I can do for you?   If you need more, please  provide  dates of both your and your spouse's entry  and if this is your first entry within the last three years.

Namaste

pk