W7 and Child Tax Credit

[Gary]

I have a client that is here on an H!B visa. He arrived in Jan 2007 and his wife and children in March 2007, all on H4 visas. I am filing their 1040 with attached W-7s to get them ITIN numbers. What is the requirement for the children to be able to get the child tax credit? Do they have to have been in the US for the full year? A child who is a citizen only has to live with the taxpayer for more than 6 months, which my clients children did? Any insight will be appreciated.

Gary

[Koss]

Nonresident Aliens?

I have a client that is here on an H!B visa. He arrived in Jan 2007 and his wife and children in March 2007, all on H4 visas. I am filing their 1040 with attached W-7s to get them ITIN numbers. What is the requirement for the children to be able to get the child tax credit? Do they have to have been in the US for the full year? A child who is a citizen only has to live with the taxpayer for more than 6 months, which my clients children did? Any insight will be appreciated.

Gary

The "lived with your for more than six months" rule applies to all children, regardless of whether they are US citizens. That rule stands on its own.

For the Child Tax Credit, the child must be a US citizen, a US national, or a resident of the United States.

As usual, resident doesn't mean "resident," it means something else.

You need to determine whether your client, his spouse, and the children are resident aliens or nonresident aliens. And that gets really complicated really fast.

I know they are not permanent residents, and that they have not been issued "green cards." But they may be nonresident aliens who are considered resident aliens for tax purposes. It depends on the type of visa, the length of their stay, and some other factors. Sometimes it even makes a difference what country they're from, 'cause some countries have tax treaties with the US, and that can actually affect their status for tax purposes.

Start with Pub. 519. It has a nice flowchart for determining whether a person is a resident alien or nonresident alien. Trouble is, almost every box in the flowchart has little footnotes and exceptions... So to get through the flowchart, you almost have to read the whole publication, and by that time you don't even remember which box you were in... LMAO

Kind of like German grammatical structure, where some sentences are so long that by the time you reach the end of the sentence, you can't remember what the subject was.

Burton M. Koss
koss@usakoss.net