I’m on H1B and filling taxes with my wife and Son as dependent. My son converted H4 to F1 visa and I’m supporting him so still can I filed as dependent him?

[ID5737800]

We are living in US last 12 yrs. So we qualify IRS substantial test. Also my son has to file his taxes so does he consider as resident or nonresident and which form he has to file 1040 or 1040NR? Please advise

[pk · Accepted solution]

@ID5737800 , Namaste Anil ji

From your post what I get is:

(a)  You , a US person ( Resident for Tax purposes )  with work visa (H1-B) , your spouse  and son   with dependent visa ;

(b) Your son went through a status adjustment  to  F-1 ( independent visa ) .

Thus , and because your son ( with a dependent visa  had been a resident for all these years ), his F-1 adjustment  does not  make him an NRA.  He also is not eligible for the exempt status.    This is my first blush response -- I need to refresh  my memory on exact wording of the relevant statute and rulings.

 You should have no issue  in  claiming  him as a dependent .   Additionally  , the Tax treaty between US and India  ( article 21 ) to be treated  same as US students in similar  tax circumstances.

Please note that because  you have been a long-term  tax resident of the USA,  there are  IRS requirements  you must meet  if and when , you leave this country and return to India.

I will come back on the earlier  issue.

In the meantime , is there more I can do for you ?   

Namaste ji

pk

[ID5737800]

Thank you pk. It helped me to clear my confusion. Just need one more clarification

My son had earning last year and he needs to  file his taxes so I believe he has to file 1040 as resident, could you please clarify here?

[pk]

@ID5737800 , I need to correct my earlier post  in that :

(a) Your son on F-1  would be an exempt individual post status adjustment.  Thus   if for example his adjustment  was  Sept 01, 2024, he is exempt status from  counting  days  present begins when he meets  and continues to meet  "student " conditions as defined  in section 7701 of the code --- I am attaching the pertinent  sentences of the code.   Thus  for the example above, I  think while  is exempt for each day he meets the "student" conditions  ( for five calendar years starting with F-1 adjustment  date or entry with F-1),  but  he may still be a Resident for tax purposes ( SPT based ) for 2024 because his exempt days do not start till he meets the "student" definition.

 For the year 2025 ( using the example above ) he will be NRA and any earnings must be filed using 1040-NR.

Here is  the text I am referring to :

26 U.S. Code § 7701 - Definitions

(5)Exempt individual defined

For purposes of this subsection—

(A)In general     

An individual is an exempt individual for any day if, for such day, such individual is—

•   a foreign government-related individual,
• a teacher or trainee,
• a student,

(D)Student

The term “student” means any individual—

(i) who is temporarily present in the United States—

               (I)  under subparagraph (F) or (M) of section 101(15) of the Immigration and Nationality Act, or

(II)  as a student under subparagraph (J) or (Q) of such section 101(15), and

(ii)  who substantially complies with the requirements for being so present.

(E)Special rules for teachers, trainees, and students

(ii)Limitation on students            

For any calendar year after the 5th calendar year for which an individual was an exempt individual under clause (ii) or (iii) of subparagraph (A), such individual shall not be treated as an exempt individual by reason of clause (iii) of subparagraph (A), unless such individual establishes to the satisfaction of the Secretary that such individual does not intend to permanently reside in the United States and that such individual meets the requirements of subparagraph (D)(ii).

  Hope this helps.

[pk]

@ID5737800 , Anil ji, please peruse my latest post/reply.  Thus if I assume that  his status change and joining a qualified educational institution took place in Sept. of 2024, then for the year 2024 he still files  return on 1040.

 Is there more I can do for you ?   You can indeed PM me  ( if the material is not of general interest -- just NO  PII -- Personally Identifiable Information ).

Namaste ji

pk

[ID5737800]

I’m little confused above,  you said for year 2025 for any earnings he would be NRA and needs to file 1040NR?

As SPT already satisfied so how he would be NRA?

Below said for 2024 he is resident and can file 1040? 

[pk]

Sorry for the confusion . What I meant is 

(a) if I assume that the change in status took place  around Sept. of 2024 and therefore he became a student in Sept 2024, then  he stopped counting days present from that date.  In that case  counting all the days present  in the country till that date he would have passed the SPT.  So he is Resident for tax purposes for 2024.  So any in com e reported on form 1040.

(b) For the tax year 2025, he continues to be a student and therefore exempt from counting days present ( as long as he meets the F-1 conditions ).  So for 2025 tax year he is NRA and any income is reported on 1040-NR  ( not supported by TurboTax).

Does this help ?