Hello,I have been living in US for 5 years now (Never left the country). Tax filings!!?

Question

Hello,

I have been living in US for 5 years now (Never left the country). I am on f1 status and while on OPT i enrolled in stocks for some side income. I let the money sit there and now its time to sell some for profits. But before i sell them i wanted to know the tax restrictions on them. I am a resident alien on f1 status. I have been filing my taxes every year in US. My broker account says they have 33% of tax exemption on my account and if i sell i assume they will take those 33% out or ask me to pay during taxes in 2013.

But i never received any 1099 form from my brokers account since i opened it (2010).EVery year they send me 1042s form which i file accordingly on taxes. But in 2010 i had a lot of my stocks down ( i never took that money out) but made a lil profit of few grands. I was expecting a form from td Ameritrade so that i can just file my taxes and pay taxes on those gains. My 1042s form did not have any profits mentioned and it only mentioned dividends i recieved. When i asked TD ameritrade they said i should pay them in my home country. And when i asked my Tax filing accountant he said if they did not send you any other form you are all set.


So i guess i need to update info on my broker account mentioning that i am a resident alien and i file my taxes here coz i believe they are confusing me as non resident alien and so they send me 1099 to file and pay taxes here. Please guide me through if you have a similar experience or have any clients in similar situations. I know its rare with students doing stocks.


Another things is i was thinking of rolling all my stocks to my husbands account who is a US citizen and he might have to pay taxes 15% (long term stock tax rate) while i might pay 33%. Please enlighten me with any knowledge that you have. Once i get a lil idea from y'all i will go to a lawyer to consult. But i just dont want to go blindly with all.

Answer 1

I could not figure out whether you have been filing your taxes as a non-resident or as a resident for the past few years. Foreign students on F1 visas qualify for an exemption from US tax residence requirements for up to 5 years.



As a spouse of a US citizen, you can choose to be treated as a US resident for income tax purposes regardless of the type of the visa you hold.



Obviously, as a US resident, you must report all your worldwide income to the IRS and pay tax at US resident tax rates.



In order for your broker to consider you a US tax resident, you need to send them form W9

That will allow them to change the tax status on your account from non-resident to resident.



Disclaimer: non of the above information should be considered a tax advice. For professional tax advice, find a US tax accountant.

Answer 2

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Answer 3

Listen to your broker. He doesn't answer questions on Yahoo.