Standard deduction is substantially increased after passing of Tax Cuts & Jobs and is a major deduction for US taxpayers who do not want to claim itemized deduction while filing taxes.However, the standard deduction is not available for nonresident aliens. But , to your surprise , nonresident aliens are still allowed to claim standard deduction in three exceptional circumstances.
Who can not claim standard deduction?
In following situations, you can not claim the standard deduction:
- If you itemize your deductions.
- If your tax filing status is “married filing separately” and your spouse itemizes deductions
- A nonresident alien or dual status alien during any part of the year
- If you file a return for a period of less than 12 months due to a change in annual accounting period
- If you are a estate or a trust, common trust fund, or partnership.
When Nonresident alien can claim standard deduction ?
- A nonresident alien who is married to a U.S. citizen or resident alien at the end of the tax year and makes a joint election with his or her spouse to be treated as a U.S. resident for the entire tax year; (also read Tax Effect of Nonresident Alien Spouse Chosen As Tax Resident of US !)
- A nonresident alien at the beginning of the tax year who is a U.S. citizen or resident by the end of the tax year, is married to a U.S. citizen or resident at the end of such tax year, and makes a joint election with his or her spouse to be treated as a U.S. resident for the entire tax year; and
- Student or business apprentice who are residents of India . They are covered by paragraph 2 of Article 21 (Payments Received by Students and Apprentices) of the United States-India Income Tax Treaty which is as under :
- 2.In respect of grants, scholarships and remuneration from employment not covered by paragraph 1, a student or business apprentice described in paragraph 1 shall, in addition, be entitled during such education or training to the same exemptions, reliefs or reductions in respect of taxes available to residents of the State which he is visiting.
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