Are there tax advantages to US Citizenship?

neha · Post by **neha** » Fri Nov 23, 2007 10:50 am

What are the advantages of being a USC after R2I? Being a USC do we have to keep filing US tax+indian tax if our income is only from India after R2I? Do we get any social secutiry benefits ?

dbs · Post by **dbs** » Sat Nov 24, 2007 7:55 pm

yes .

layman · Post by **layman** » Sat Nov 24, 2007 9:49 pm

neha;59412What are the advantages of being a USC after R2I? Being a USC do we have to keep filing US tax+indian tax if our income is only from India after R2I? Do we get any social secutiry benefits ?[/quote]
This has been thrashed umpteen times before. Search the old threads. You are supposed to get social security irrespective of whether you are USC or not. But, there is a general belief among lot of Indians that being a USC puts them in a stronger position against non USCS if things get worse with Soc Security in the future. Again, there is no proof for this. This is just a belief. Being a USC, you can travel to US and Europe easier than a non USC. An USC has to file US tax irrespective of wherever he/she lives. You are liable of Indian tax if you are a resident of India.

Ace Novice · Post by **Ace Novice** » Sat Nov 24, 2007 10:27 pm

neha;59412Being a USC do we have to keep filing US tax+indian tax if our income is only from India after R2I?[/quote]

Your mothership becomes the USA and yes you have to report back every year with how much you have made the world over (and beyond if applicable).

neha;59412Do we get any social secutiry benefits ?[/quote]

Per the current laws, you will get social security benefits whether you are a permanent resident or citizen. This assumes you have the required 40 credits and that social security does not go bankrupt.

neha · Post by **neha** » Mon Nov 26, 2007 4:41 am

Do we have to pay double tax on the money we earn in India(i.e to both US and India govt) or is it that we pay taxes to india govt, but just report our income to US govt?

jaihind · Post by **jaihind** » Mon Nov 26, 2007 5:00 am

neha;59412What are the advantages of being a USC after R2I? Being a USC do we have to keep filing US tax+indian tax if our income is only from India after R2I? Do we get any social secutiry benefits ?[/quote]

There are other ramifications of being a USC that asume greater importance in life (or atleast I hope so in most cases) than SS benefits. One of the biggest ones - given the significance of familiy to most Indians - is the ability to visit ones' kids if/when they pursue higher studies in the U.S.A. You never know how changes in bilateral relations between India and the U.S. or other geopolitical reasons impact the visiting lengths or even the availability of a tourist visa (or a work visa if you wish to be in the US while your child is going to college). Having a US passport will allow you to travel to the USA as and when you choose. I'll go with a USC/OCI combination any day (barring some unforseen event) to maximize the fexibility of working in either/living in either/travelling between the two countries.

shreekarthik · Post by **shreekarthik** » Thu Nov 29, 2007 3:13 am

jaihind;59872There are other ramifications of being a USC that asume greater importance in life (or atleast I hope so in most cases) than SS benefits. One of the biggest ones - given the significance of familiy to most Indians - is the ability to visit ones' kids if/when they pursue higher studies in the U.S.A. You never know how changes in bilateral relations between India and the U.S. or other geopolitical reasons impact the visiting lengths or even the availability of a tourist visa (or a work visa if you wish to be in the US while your child is going to college). Having a US passport will allow you to travel to the USA as and when you choose. I'll go with a USC/OCI combination any day (barring some unforseen event) to maximize the fexibility of working in either/living in either/travelling between the two countries.[/quote]

If situation gets that worse then you won't be able to visit your extended family here from US too....

r2i_100 · Post by **r2i_100** » Thu Nov 29, 2007 6:50 am

shreekarthik;61011If situation gets that worse then you won't be able to visit your extended family here from US too....[/quote]

Get an OCI and you will be covered.

vivmat · Post by **vivmat** » Sat Dec 01, 2007 1:16 am

Please feel free to look at
http://groups.msn.com/R2INRIFinanceAndInvestments/general.msnw?action=get_message&ID_Message=50594&ShowDelete=0&CDir=2&all_topics=1

With Bobus' help I had created an XL that outlines advantages and disadvantages of USC versus NRA as far as taxation goes.

Here is the XL sheet (attached) as well.

Some things have changed since I last put this together and I've been meaning to go back and update it, but havent had the chance.