1

Greetings of the season.
I have some clarifications and questions regarding taxation for Indian's living in U.S.

  1. What is the maximum cash gift a person can receive from Indian parents?
  2. Beyond what limit the cash received from parents are taxable?
  3. Can stocks/shares held in the name of Indian parents be transferred to children living in U.S and what is the tax implication on it ?
  4. Other incomes like rent/dividends received in India, should the tax be filed in India or U.S.?
  • Just to confirm, your citizenship is US [and you are PIO, Person of Indian Origin] and Parents is Indian – Dheer Apr 23 '15 at 4:40
  • "Beyond what limit the cash received from parents are taxable?" Gifts are not taxable to the receiver, but might be taxable to the gifter. – user102008 Apr 24 '15 at 22:43
1

What is the maximum cash gift a person can receive from Indian parents?

There's no limit on what a US citizen can receive. The only thing to keep in mind is that if you get $100K or more in gifts/inheritance from foreign persons - you'll need to report it (not pay any taxes!) to the IRS on form 3520 as part of your tax return.

Beyond what limit the cash received from parents are taxable?

Why would it be taxable? If it is a gift - it is not taxable.

Can stocks/shares held in the name of Indian parents be transferred to children living in U.S and what is the tax implication on it ?

It doesn't matter what you get as the gift, the $100K rule I mentioned above applies (if you don't receive the actual money - then you need to calculate the fair market value of the gift to know if it needs to be reported).

Other incomes like rent/dividends received in India, should the tax be filed in India or U.S.?

Most likely both. US taxes worldwide income, and India is likely to tax income sourced to India. There's a tax treaty between India and the US that may regulate some cases, but for most parts it doesn't apply to US citizens so you need to check carefully. In any case, you use the taxes paid in India as credit towards your US taxes on the same income, and that allows to alleviate the double taxation to some extent.

0

This is from India point of view, Someone would come along and answer taxes from US point of view.

Can stocks/shares held in the name of Indian parents be transferred to children living in U.S and what is the tax implication on it ?

Assuming you are PIO and now US citizen, you would be treated at par with NRI. You have to open an NRI Demat NON-PINS account. Shares can be transferred to this account. Note you cannot buy additional Shares in the NRI Demat NON-PINS account. You can sell the proceeds and repatriate the funds outside India to the limit of USD 1 million per year. There would be some formalities that a CA can help when you need to repatriate the funds. Long term capital gains are tax free in India.

Not sure of the tax implications in US.

Other incomes like rent/dividends received in India, should the tax be filed in India or U.S.?

Rent: Yes you would need to pay tax in India. As per DTAA with US you can claim rebate. There are tax implications in US.
Dividends: There are tax free in India.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.