Married Canadian commuting to Buffalo to work 1040NR hit AMT

[wx1234ca]

I started my work back in 2007, have 3 children, one dual citizen, two canadian citizens, my wife and I are canadian citizens as well. No GC.

I have been filing 1040 NR, no issue until 2014.

2014 I received a letter to ask me to file 6251 AMT form, since then I have been owing tax every year.

Last year 2015, I purposefully omitted 6251, once again, received letter to fix it.

This year I am doing for 2015 tax, again, while doing 6251, AMT increased my tax by over $2500, instead of getting a refund of 1500, I need pay back about 1000.

I also own a townhouse in Florida with some loss every year.

I read all posts here, am getting very confused.

do I need 8833 XXV(3) or XXV(4) to file as MFJ?
Then I need do a 1040 to figure out the tax rate.

any other way not to do 6251 AMT without 8833 as it needs another 1040 for both my wife and my self, need adding RRSP and RESP?

BTW, my wife works in Canada, no income in US.

[nelsona]

As you are noticing, it is pointless to reduce your US taxrate too much, not only for AMT, but also, you are simply increasing your Cdn tax.

If AMT is not impacting your overall tax for the year I wouldn't worry.
I do find it unusual that you would be hit with AMT, since the 1040NR taxrate is quite high for marrieds.

I wouldn't bother with XXV either, since this is designed to lower your US tax, which obviously won't happen if you are hitting AMT.

Sounds like you may need to back off the deductions and losses.

[wx1234ca]

Nelson, Thanks for quick reply. You are always very helpful here.

In case, backing off deductions and losses would not change much.

In 1040NR, line 39 is after total income subtracting my vacation house loss and itemized deductions, this is also used in 6251.

The only additional deductions beyond line 39 is line 40 - exemptions - which is standard, 5 X 4000=20,000.

So 1040 NR would be line 39 -20,000 to calculate tax.
6521 would use line 39 + state tax, the major negative impact here is the MFS amount 41700.

[nelsona]

Did you read what I said? Stop taking all those deductions.

And is it impacting your OVERALL tax: US+ state+ AMT plus CRA?