No standard deduction

Forum|Forum|3 years ago
April 24, 2023
2 replies
12 views

From Jan to November I legally worked for 11 months in the US for US company, and 1 month in Slovakia for slovakian company (as non resident). I read I need to fill out both 1040 and 1040NR as a single taxpayer. I made $40k in the US as a resident. If I can't claim standard deduction, and don't have any medical bills, loans, house etc. will I end up paying more tax that usual if my foreign income is only $800? All other years as a resident working only in the US I got some tax back (around $500). Will the lack of standard deduction negatively impact my tax filling? Thank you

Not A Product Question

Best answer by Opus 17

Thank you! You are the best. I paid taxes in Slovakia for one month so in order to avoid double taxation I understand I also need to file foreign tax credit form 1116 and convert euro to dollars?

@Japtrupusz wrote:

Thank you! You are the best. I paid taxes in Slovakia for one month so in order to avoid double taxation I understand I also need to file foreign tax credit form 1116 and convert euro to dollars?

Yes, you can include form 1116 to claim a credit for taxes paid to Slovakia on that part of your income. Report the credit in US$ using the exchange rate on the date you paid the foreign taxes.

https://www.irs.gov/individuals/international-taxpayers/foreign-tax-credit-choosing-to-take-credit-or-deduction

https://turbotax.intuit.com/tax-tips/military/filing-irs-form-1116-to-claim-the-foreign-tax-credit/L2ODfqp89

https://www.irs.gov/instructions/i1116#en_US_2022_publink11441fd0e615

Opus 17

Level 15

It appears you pass the substantial presence test.

https://www.irs.gov/individuals/international-taxpayers/substantial-presence-test

That means you are considered a "US resident" for tax purposes and are required to file a US tax return (form 1040, not form 1040-NR) that reports and pays income tax on all your world-wide income.

You should also read publication 519.

https://www.irs.gov/forms-pubs/about-publication-519

Filing both a 1040 and 1040-NR would apply to a "dual status" alien, but you are not dual-status alien if you pass the substantial presence test for 2022.

JaptrupuszAuthor

Level 2

Thank you! Somebody advised me I need to file 1040 as a resident and 1040NR as non resident as I abandoned my green card and that I am a dual status taxpayer. I lived in the US for 7 years and left in November, worked only for a month in Slovakia after moving there permanently.

Opus 17

Level 15

@Japtrupusz wrote:

Thank you! Somebody advised me I need to file 1040 as a resident and 1040NR as non resident as I abandoned my green card and that I am a dual status taxpayer. I lived in the US for 7 years and left in November, worked only for a month in Slovakia after moving there permanently.

If your ending date was earlier in 2022, so that you did not pass the substantial presence test, you might be a dual status alien. But since you do meet the substantial presence test, you are considered a US resident for the whole year. If you remain overseas, you would be a non-resident for 2023 and would only file a 1040-NR if you had US-source income (income that was "effectively connected" to the US.)

Here's another link.

https://www.irs.gov/taxtopics/tc851

JaptrupuszAuthor

Level 2

Thank you! You are the best. I paid taxes in Slovakia for one month so in order to avoid double taxation I understand I also need to file foreign tax credit form 1116 and convert euro to dollars?