In 2006, I was in India for first 3 months & then came to US on L1 with same employer. On my W2 only US income is mentioned. Do I need to pay US taxes for only US income or do I need to convert 3 months of indian salary(already taxed at India) to US dollars & add to my total US income ? If I have to again pay tax on that 3 months Indian salary, can I somehow request for its refund?

I'm assuming that you are single. In that case, you are a dual status alien (part of your year you were non-resident and your India income does not need to be reported). The other part of the year you were resident and you have to report worldwide income.

The dual status return is more challenging to prepare. You can probably do it alone or get help. ATG takes clients and he can help for a reasonable amount. I am extremely busy and not in a position to take many clients and I charge a lot.

I AM taking clients!

If you need my professional help, contact me at [email protected].

I am married & my wife was with me during 3 months in India & later 9 months in US for Yr 2006

Because you were married, you would have the option to elect to be a US resident for the full year. If you do so, you need only file a 1040 as a resident. However you will need to report your entire worldwide income for the year (including the part made in India) and claim a foreign tax credit. It will be a little complicated, but manageble.

Can I file now as US resident or do I need to wait for some period ?

How can I calculate tax on 3 months of Income which I made in India? I am asking this because those 3 months ( Jan 2006 to March 2006) is part of earlier indian taxable year.

Will it be direct formula :-
Total tax paid in 3 months = Total tax earned in the taxable year (of which those 3 months were the part) / 4

Also what would be dollar-rupee converison ratio that I would have to use ?

You have pay stubs for the three months, right? Use them.

I used 44 rupees to the dollar.

Hi Taxsearcher/ATE,

Thanks a lot for your help :)

I understood the following from your replies :-

Though I had a dual status in yr 2006, but I have an option to file as resident alien because my status was married during complete yr 2006.


Please correct me if I am wrong.

Yes, what you said is accurate.