I am a nonresident (Indian) looking for advice regarding filing my 2006 taxes. During 2006 I was on F1-OPT till June 28. I started work from my employer in Wash DC on April 24. Since my OPT expired in June, I relocated to the New Delhi office of my company in order to remain in status and still continue my work, while the mothership processed my H1 visa. I worked from June 29 to December 4 out of the Delhi office and returned to the US with my H1 visa on December 5. During my time in India, my wages were being directly deposited to my US account by my employer and federal/state taxes being withheld as if I was still in DC. Consequently my W2 shows my income from April 24 till the end of the year. In sum, I earned around 40k in total from: Jan 1 - April 23 No job April 24 - June 28 on F1 OPT June 29 - December 4 worked in India for the same company December 4 - December 31 on H1 B
So my question is: Is the income - for the five months I was in India - tax exempt? If yes, where do I show it on 1040NR? A related question - Since the majority of the income I earned while I was in the US was while I was on my F1-OPT (April 24 - June 28) can I still claim the standard deduction for Indian students? Kindly let me know your thoughts. Thanks so much in advance.