Hi All,

I returned to India on Dec 2006 after staying 7 years in US and got married to an Indian girl Sep 2007. She is an home maker and I wanted to open a brokerage account in USA under her name. I do not want to open in my name due to potential tax complications both in India and US ( as I work in India full time and no plans of going back to US).

My questions are:

1. Can a person who has never been to USA can open a brokerage account in USA?

1. If she has any capital gains in US, does she have to pay US tax ?(please note that she has never been to USA)

2. The broker agreed to wire out capital gains(if any) to our indian account once in 3 months. We asked him about the US tax question but he was not sure. He said he will get back to us 2 weeks ago but no luck yet. Does this scenario create any complications in India?

3. We knew that we need to file tax return in India for this capital gain in US but anyone know the procedure.

Any response would be highly appreciated and thanks a lot for reading my question.

Thanks.

Capital gains on the sale of personal property (like stock) by a nonresident alien are considered sourced without the United States. Thus, there is no US tax on that gain.

Nevertheless, you will be required to submit a W8-BEN to the broker to avoid withholding tax. Fill in Part I only, have your wife sign and date it and send to the broker. Since no treaty benefit is being requested an ITIN is not required.

I would assume you are taxable in India on the gain but have no idea of Indian tax law. Find a professional there.

R2idreamer:

I am surprised you could get the brokerage house to open an account for your wife without an ITIN, but if you could, then great!

Please identify the brokarage house, as there are other Indian nationals who would like to do the same as you.