FAQs-US Taxation

FAQs-US Taxation

1. Who needs to file a tax return in the U.S.?
   • Resident aliens: File Form 1040EZ, 1040A, or 1040.
   • Nonresident aliens: File Form 1040NR or 1040NR-EZ.
   • Must file if engaged in a U.S. trade or business, or have U.S. income without tax withheld.
2. What is the various filing status?
   • Different filing statuses based on individual circumstances.
3. What authorities must I pay taxes to?
   • Federal, State, and Local tax authorities, depending on residency.
4. Does a foreign national have to file a tax return in the U.S.?
   • Yes, foreign nationals (aliens) must file and report their income.
5. What income needs to be reported for tax purposes?
   • Residents: Report worldwide income.
   • Non-residents: Report U.S. sourced income.
6. What are qualified itemized deductions?
   • Medical and Dental Expenses
   • State and Local Income Taxes
   • Real Estate Taxes
   • Personal Property Taxes
   • Home Mortgage Interest
   • Charitable Contributions
   • Unreimbursed Employee Expenses
   • Tax Preparation Fees
   • Investment Expenses
   • Safe Deposit Boxes
7. What tax credits are available?
   • Foreign Tax Credit
   • Child and Dependent Care Credit
   • Credit for the Elderly or Disabled
   • Education Credits
   • Retirement Savings Contribution Credit
   • Child Tax Credit
   • Lifetime Learning Credit
   • AMT Credit
8. What is SSN/ITIN?
   • SSN: A nine-digit number for U.S. citizens, residents, and workers.
   • ITIN: A tax processing number for individuals who need a U.S. taxpayer ID but are not eligible for an SSN.
9. How to apply for ITIN?
   • Submit Form W-7 with a federal tax return and proof of identity documents to the IRS.
10. What is the due date for filing the tax return?
    • April 15th for the previous year's tax return. Extensions available but interest and penalties may apply.
11. What are other important dates to remember?
    • December 31: Last day for self-employed to set up a Keogh Plan.
    • January 15: Pay the balance of estimated tax.
    • 15th day of the 4th month after the fiscal year ends: File fiscal year return and pay balance due.
12. Can filing separate returns be advantageous?
    • Yes, in cases where one spouse has large medical expenses, itemized deductions, or casualty losses, or if spouses’ incomes are about equal.