My assets in India, US and FBAR

chalovadodara · Post by **chalovadodara** » Wed Mar 30, 2016 11:47 pm

Hi My Fellow r2I members,
Since this is my first post on this site, let me start with a big thanks to the people who share their experience and knowledge that makes people?s r2I easier.

Let me start with my background first.
We are a family of four All US Citizen with my elder kid is 9 years and younger one is 6 years old. I am planning to r2I to Vadodara, Gujarat area in 2017 before the CBSE school year starts. Me and my wife are in USA for more than 15 years now.

Assets I have:
1. House worth $200K
2. 2 Cars not even worth $10K
3. 401-K through employer: Approx. $100K
4. Cash balance (CDs and Savings): $350K
5. Stocks: $10K
6. Investments in India which includes Regular savings account, FDs, Stocks, MF, LIC, POST, etc.: $170K

While reading through the financial posts, I started realizing that I might have a big problem with money I have in India. My investments in India are invested as regular resident of India since most of it is inherited from my late parents. I didn?t make any changes since then except keep renewing OR consolidating some FDs.

I been filing the US tax returns without any mention of money I have in India. I know about FBAR from last two years (don?t have enough knowledge of it though. ) but then I thought it is too late to disclose my foreign accounts and in addition, I am legally not allowed to keep the regular accounts in India. I am allowed to keep only NRE OR NRO account and there are no one in India who can do it for me unless I go there and spend significant amount of time to consolidate all the accounts and open NRO account to transfer into it

I also started filing the tax return in India after my father?s death and all my money in India are being shown on my Indian tax return (All Indian money are white).

I really need a desperate help to solve this puzzle. How can I straighten the things out? Another part of a problem is my parents are no more. So unless I go there, no one can move my finance around if I have to.
If I don?t do anything with my current finances in India, problem will simply get worse when I will start working in India after R2I. Since now everything is reported under my PAN#, and when I will file my US return for 2017, every investment I have done in India will be discovered.

Has anyone gone through this situation and please guide me to solve this piece of puzzle. It is not that I wanted to hide my earnings or anything. It is just how that can be managed if I will have to move my investments around.
Please.. please.. I need a desperate help.. Any help from our r2I community is appreciated.

Thanks

FB2020 · Post by **FB2020** » Wed Mar 30, 2016 11:53 pm

I don't have much knowledge, so can't help much.

But at least starting this year, you should at least file FBAR since you have more than $50K in assets outside US.
Also, do you report indian interest income on US taxes? I believe that's also required (although you can take credit for the indian taxes paid).

Some more "FBAR experienced" folks can pitch in.

you can also ask this question to some tax consultants on this forum - they have their separate thread (KKR associates, Rajesh Dhruva etc.)

good luck and keep us posted. I'm sure you're not alone in this situation.

chalovadodara;627405Hi My Fellow r2I members,
Since this is my first post on this site, let me start with a big thanks to the people who share their experience and knowledge that makes people’s r2I easier.

Let me start with my background first.
We are a family of four All US Citizen with my elder kid is 9 years and younger one is 6 years old. I am planning to r2I to Vadodara, Gujarat area in 2017 before the CBSE school year starts. Me and my wife are in USA for more than 15 years now.

Assets I have:
1. House worth $200K
2. 2 Cars not even worth $10K
3. 401-K through employer: Approx. $100K
4. Cash balance (CDs and Savings): $350K
5. Stocks: $10K
6. Investments in India which includes Regular savings account, FDs, Stocks, MF, LIC, POST, etc.: $170K

While reading through the financial posts, I started realizing that I might have a big problem with money I have in India. My investments in India are invested as regular resident of India since most of it is inherited from my late parents. I didn’t make any changes since then except keep renewing OR consolidating some FDs.

I been filing the US tax returns without any mention of money I have in India. I know about FBAR from last two years (don’t have enough knowledge of it though. ) but then I thought it is too late to disclose my foreign accounts and in addition, I am legally not allowed to keep the regular accounts in India. I am allowed to keep only NRE OR NRO account and there are no one in India who can do it for me unless I go there and spend significant amount of time to consolidate all the accounts and open NRO account to transfer into it

I also started filing the tax return in India after my father’s death and all my money in India are being shown on my Indian tax return (All Indian money are white).

I really need a desperate help to solve this puzzle. How can I straighten the things out? Another part of a problem is my parents are no more. So unless I go there, no one can move my finance around if I have to.
If I don’t do anything with my current finances in India, problem will simply get worse when I will start working in India after R2I. Since now everything is reported under my PAN#, and when I will file my US return for 2017, every investment I have done in India will be discovered.

Has anyone gone through this situation and please guide me to solve this piece of puzzle. It is not that I wanted to hide my earnings or anything. It is just how that can be managed if I will have to move my investments around.
Please.. please.. I need a desperate help.. Any help from our r2I community is appreciated.

Thanks

chalovadodara · Post by **chalovadodara** » Thu Mar 31, 2016 12:35 am

Thanks FB2020,
I also will post the similar question in KKR associates, Rajesh Dhruva thread. I also might need to get help from any CA OR CPA who knows US and India laws. Does anyone know of any CA in Gujarat preferably in Ahmedabad, Vadodara, Surat?

Thanks

FB2020 · Post by **FB2020** » Thu Mar 31, 2016 12:54 am

I believe Rajesh Dhruva would be your best bet.
He's very knowledgeable on these fronts. You should start with him.

chalovadodara;627411Thanks FB2020,
I also will post the similar question in KKR associates, Rajesh Dhruva thread. I also might need to get help from any CA OR CPA who knows US and India laws. Does anyone know of any CA in Gujarat preferably in Ahmedabad, Vadodara, Surat?

Thanks

Chakraan · Post by **Chakraan** » Thu Mar 31, 2016 1:05 am

chalovadodara;627411Thanks FB2020,
I also will post the similar question in KKR associates, Rajesh Dhruva thread. I also might need to get help from any CA OR CPA who knows US and India laws. Does anyone know of any CA in Gujarat preferably in Ahmedabad, Vadodara, Surat?

Thanks

I think Rajesh Dhruva is from Vadodara and he has his office there.

http://www.nribanks.com/index.php

Added later,

May be Rajkot

greyfri · Post by **greyfri** » Thu Mar 31, 2016 5:01 pm

FBAR is triggered by 10K limit, not 50K

Form 8938 limit is 100 K at year end, 150K at any time during the year for US persons residents in the US. If you move to India, the threshold goes up for married taxpayers -- $400K at year end, $600K anytime during the year. The assets covered are not the same as those covered by FBAR although there is some overlap. Personally, I think 8938 may be more tricky to handle because the statute of limitations on that form (and on any tax return for that year) remains open forever until the form is filed.

chalovadodara · Post by **chalovadodara** » Thu Mar 31, 2016 7:38 pm

Thanks Greyfri for your clarifications.
By this discussion, I know for sure that I will have file FBAR. How penalties work in case of FBAR? I heard that IRS running a program called FBAR amnesty. Is it still valid?
I been filing the Indian tax returns every year but wasn't showing Indian income here in the US tax returns. what I will have to do in this front to bring myself into compliance?

Thanks a lot

Plan2Return · Post by **Plan2Return** » Thu Mar 31, 2016 7:52 pm

OP, are these accounts opened as NRI or have they been opened when you were RI. In other words, what is the common record to tie these accounts to your NRI status ? Do all these Indian account have your US address etc.,?

chalovadodara · Post by **chalovadodara** » Fri Apr 01, 2016 12:19 am

No, all these accounts are opened when I was RI and the address is also my Indian address on all accounts.