USC ROR in India : Question on RSU taxation in US and India

[savs]

I am a USC living in India working for a foreign subsidiary of a US company. I have RSU granted in India in 2008 for a US company listed in Nasdaq.

These RSU have been vesting every year (2009 and 2010). In my India Form 16 for fy 2009-2010, the RSU that vested between 1st April 2009 and March 31, 2010 have been shown as regular income and taxed accordingly. The RSU that have vested between 1st April 2010 and March 31, 2011 will be subject to Indian tax for FY 2010-2011. A portion of the RSU are automatically being sold every year to cover the Indian taxes.

My question is now about the US taxes - in my 2010 return, do I include the RSU income as Foreign Income not shown on W2 ? Which RSU transactions (the ones before April 1, 2010 or the ones after April 1, 2010) should I include ? Please note that the ones after April 1, 2010 have not been taxed yet in India and I assume that India would get first dibs on these taxes.

Also, once I include the RSU income (based on the 2009 RSU transactions), I exceed the limit of the foreign income exclusion (I believe the limit is $ 87500 in 2010). So, despite the fact that I have been taxed a full 30% in India on my total income, do I still need to pay US taxes on the excess amount ? If so, does'nt this amount to double taxation ?

A quick response would be much appreciated. Need to get this done by April 15th. Thanks.

Savs