Returning to India - 2019 2020. Tax planning

eBay CEbi00
Nov 17, 2018 24 Comments

Any experienced folks who have dealt with tax planning and asset vs income considerations when you are moving back to India . This is for visa holder , so for US tax purposes I would be considered as NRA - non resident alien.
Assets
401K
Roth IRA
529 plan
House
HSA
Estate planning
SSN eligibility if you are still NRA but completed 40 credits
RNOR status for 3 years

comments

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TOP 24 Comments
  • Facebook Instagrаm
    Apply to a bunch of credit cards, withdrawal cash and flee to India.
    Nov 17, 2018 14
    • Amazon / Eng
      sarcasticg

      Amazon Eng

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      Sabre Corporation
      sarcasticgmore
      Lol sprung do you even know the backed up cases in each court? I think there are more than 100 million pending cases in various courts for various crimes. Civil cases barely see any day light and there is a government aided out of court settlement process on most civil matters.

      Coming to sending police, first of all the loan default happened in US. Collection agencies don't send police to defaulters even in US. They sue in a court. They don't send cops to your home.

      Secondly, even if the collection agency, a non government entity, reaches out of ministry of external affairs, since the crime... Well loan default, did not happen in India, indian judiciary has no jurisdiction.

      If Interpol is involved that is a different case. To get interpol involved, the US government will have to make a case in the international court and the interpol gets involved.

      Though the information is chained and can be traced back to any country, the jurisdictions and procedural beauracracies make it much more complicated than you imagine

      Even within US to one state troopers don't have jurisdiction in the neighboring start. FBI should be involved to solve cases spread across multiple states.
      Nov 18, 2018
    • Apple
      Sprung

      Apple

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      Spittoon of Upper Mgmt
      Sprungmore
      Nobody goes to the court. The court would get involved when the party would decline to pay. In this case the party disappeared ( ran away to their country ). They never declined. All what the collection agency needs to do is to trace the party and alert the Indian authorities (Indian consulate in USA in this case) which they can do with just a mouse click (without going to the court). And Indian authorities would stop all their work and pay attention to even a small tweet from USA. They can spend years not paying attention to their internal matters but anything coming from USA would be the top priority for them. Trust me on that. It is a golden opportunity for them to make money by harassing you. You can then choose to go to court to stop being harassed but then what would be your defense ?
      Nov 18, 2018
    • DoubleVerify Karius123
      The collect agency can do nothing. They can send threatening mails and calls to intimidate people who fall for it ; that's it and it looks like your friend was gullible to fall for it (not that would ever recommend taking loans without the intention to repay). Even that would stop if you tell them not to contact my calls again as they are legally obliged to, so then they're just left with mails.
      They cannot force even their own law enforcement within US to take action, forget out in India.

      Even in India the most one can do is to repossess any collateral for the loan if it is a secured loan. For an unsecured loan, there's NOTHING they can do. Period.
      Nov 18, 2018
    • Apple
      Sprung

      Apple

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      Spittoon of Upper Mgmt
      Sprungmore
      That is where the local police comes into picture in India. Such people are the best targets to extract money because they can’t go to the courts. So you need to bribe the local policemen from time to time to escape being harassed.
      Nov 18, 2018
    • Amazon / Eng
      sarcasticg

      Amazon Eng

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      Sabre Corporation
      sarcasticgmore
      Sprung... Are these your opinions or do you know these for facts? Any request coming from a random US collection agency is not the same as a request coming from the Whitehouse. Please understand that. Unless the governments are involved, which for a few hundreds/thousands of dollars, would be a stretch over a private collection agency.

      You are watching too much of whatever Whitehouse drama it is you are watching. House of the cards, designated survivor or the Secretary of the state.

      Why would local police get involved? On whose orders?
      Nov 18, 2018
  • Apple
    Sprung

    Apple

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    Spittoon of Upper Mgmt
    Sprungmore
    Anytime b/w Feb 1 - March 30 of any year is the ideal time to make a move because it keeps you as resident alien for US since you pass the substantial presence test of US and you get favorable tax rates. And in India the financial year ends in March so again you would be in lower income tax bracket over there. That is when you can take advantage of liquidating your funds because income-wise you would be in the lower tax brackets for both the countries.
    Nov 17, 2018 3
    • eBay CEbi00
      OP
      @Sprung. Appreciate your response . I agree for the 1st part for resident alien tax benefits here . However for the 2nd part w.r.t liquidating USA assets or income , I read that RNOR status helps you in transferring of assets and income , without additional taxes in India . So the lower income bracket in India May not be overall useful due to progressive tax system in both countries . Pls let me know if you disagree on the 2nd part
      Nov 17, 2018
    • Apple
      Sprung

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      Sprungmore
      That is correct but to get RNOR status you need to have lived outside India for 9 out of preceding 10 financial years of india. If you satisfy that criteria then yes you have 3 years to move your assets tax free from USA to India. But keep in mind you would become a non resident alien of USA if you don’t spend at least 31 days in a given year in USA and non resident alien gets taxed at a flat 30% rate on most of the investments. So it would be better to not wait for the second or third year to liquidate your assets because then you would be taxed higher by USA. Also before you go back to India you need to get an income tax clearance certificate from USA that you have fulfilled your tax obligations before departing the country. Think of it as an early tax return. You need that certificate because if in case you plan to visit USA sometime later in life and reapply for another visa then they would ask you for it to make sure that you did not evade any taxes.
      Nov 17, 2018
    • eBay CEbi00
      OP
      Yes, makes sense to me. 👌
      Nov 18, 2018
  • India doesn't recognize tax free 401k accounts. So if you have gains in your 401k + Roth IRA investments sell them and park in cash before you leave. Once in India you will have to start paying investment tax on any gains made in US retirement accounts.
    Nov 17, 2018 2
    • eBay CEbi00
      OP
      @Truldiot do you know if we can bring assets that includes cash, property , etc in home country , any time in future without any tax consequences ? Asset was earned while being in USA, so wondering if that should be withdrawn as is . I agree future income on those assets should be taxed
      Nov 18, 2018
    • New CQwg28
      Don't want to give half baked advice. Please check with other sources
      Nov 20, 2018
  • Wells Fargo qUyB01
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    Nov 17, 2018 0
  • EMC FXph42
    *Following*
    Nov 17, 2018 0