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I was on an F-1 visa from August 2013 till September 2017 and on an H1B visa from October till now. I am single. I filed extension for the 2017 year and now as I am Resident for tax purpose as I satisfy Substantial presence test, I will elect for the first-year choice and file Dual status tax returns. I have created a statement for the first-year choice. I am going to take a standard deduction and US-India tax treaty itemized deduction for the non-resident part and none for the resident part. I will be attaching 1040 first then 1040NR both with "Dual-status return".

I am confused about how to compute taxes and complete federal forms now

  1. Do I have to individually complete 1040 and 1040NR with respective income, use individual tax brackets to calculate tax for each? No need to put total anywhere?
  • what's the benefit of doing dual-status as opposed to just nonresident for the whole year (as you were by default)? – user102008 Jul 24 '18 at 18:17
  • Then I won't be able to use US-India tax treaty $6350 as an itemized deduction. So only thing that can be itemized deduction, would be my state taxes which are 2832. Also not sure but I can take exemption on both tax returns it seems irs.gov/individuals/international-taxpayers/… – Ruturaj Jul 24 '18 at 21:51
  • Why not? That doesn't make sense. Indian students are able to take the standard deductions precisely when they are nonresident. (Residents are always able to take the standard deduction, so there is no treaty benefit there.) – user102008 Jul 25 '18 at 0:01
  • The treaty is for Nonresident Students and not applicable for H1B employees. I have found different opinions on this on intuit forum, Quora, and StackExchange. For filing as Non-resident, Glacier didn't use it, Sprintax (who I don't trust) used it. – Ruturaj Jul 25 '18 at 2:41

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