Disclaimer : I am not a tax attorney, CA or CPA. I have collected all this information from the internet. This is not a tax advice to anyone. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

There are three things in life you can’t avoid .

Death💀, Taxes💸 and App Updates 📱 — Unknown.

Tax season is going on full swing in USA. I was going through some articles about how to report taxes on my investments in India. Needless to say, I was shocked to see how complicated it is to determine your tax liability when you have foreign assets/investments. I couldn’t find single source of information. I started collecting all that information and thought I will just share it with you all to save you some time. I know I know. You can thank me later :-)

Keep in mind that this is only applicable if you’re NRI living in USA and you’re Resident alien from tax purposes. So if you’re on any work visa, green card holder, then these laws will be applicable for you.

Recently US government and Indian government signed a treaty under FATCA (Yes FATCA ! Some US diplomat wanted to be real sarcastic) where NRIs/US Citizens have to report their financial assets. This was implemented because lot of NRIs were not reporting their foreign assets and were avoiding paying taxes on their foreign income. To overcome this problem IRS signed a treaty with Indian government where Indian financial firms will be required to report all details about Indian financial assets of NRIs living in US or US Citizen to IRS. This is totally separate from paying taxes on your global income. As such, if the foreign financial asset generates income, you have to report such income on your annual tax return and pay taxes accordingly. FATCA is for asset reporting purposes and your tax return is for income reporting purposes.

Let’s start with reporting aspect of this.