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I have an NRE account in India. I have been paying taxes on the interest and also reporting the total funds on FBAR every year. I have repatriated some of the money to the US this year. What IRS form(s) need to be used to report this withdrawal? Also, do I have to pay any taxes on that?
Thank you.

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There are no IRS forms to be filled out when you transfer money from your NRE account (or from your NRO account for that matter) to your US bank account since the money is your money and the act of transferring the money from an Indian bank to a US bank does not create any income for you.

Now, if the amount in a single transfer is $10,000 or more, the US bank will report it to the IRS for other reasons but you don't have to file any paperwork about it. And for heaven's sake, don't structure a large transfer as several separate transactions of less than $10K to avoid this reporting; that will get you into more trouble than it is worth.

Note incidentally that because of exchange rates being different, it is entirely possible that you might be bringing back fewer US dollars than you sent (even including the interest earned thereon on which you have already paid US income taxes in US dollars) and so will have a net loss.

  • Thank you both very much for the answer I was looking for. Since I still will have some money (<$10K) in my NRE account, I will file taxes on the interest as before. Do I have to file an FBAR to reflect the withdrawal of the funds even though the total current balance is <$10K? Thank you, again in advance. – SStx Dec 7 '18 at 2:11

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