Subject: treaty and lads

From: [email-masked]
Date: Tue, 15 Mar 94 09:56:34 CST

Here we go. Lads tax returns. 

I try to put the question in more specific topics and give my 
comments wherever I have.

About residency
----------------
This is usually the first thing you have to think about. Do they qualify 
as a resident, non-resident alien or dual status? Again you go through the 
two tests. Any rules that apply to F, J, M, students or J teacher and 
scholars also apply to their immediate family members. (see Pub 519, 
Chapter 1). This means F-2 can be treated as an 'exempt indivdual' in the 
substantial presence test. 

So for most lads, who were not approved last year, they should qualify 
as non-resiedent alien.

About tax treaty
----------------
The treaty applies to those individuals who come temperory for the SOLELY 
purpose of his training, education or obtaining special technical 
training. (see complete definition in Article 20 of Sino-US treaty.) 

This looks exclude any J-2, F-2 benefiting from the treaty in any 
way. 

About status
------------
open for answers.

What to choose?
---------------
Now if they cannot be benefited from the treaty, do they still want to file 
as NR alien or they better off elect to file as resident?

The only criterion is that you should go whatever gives you the lowest tax 
legally. This could be quite a homework for many people. You should work 
it out very carefully for your own situation, with all the rules applied 
properly.

Further discussion on this topic will only be meanfull when we have a 
comlete information on certain case.

YSZ