Hi,


I am a resident in India and I was a resident alien in USA previously for 6 years and have filed US taxes. Now I am in India, but earning Capital gains and interest income in USA.

I am paying taxes in India for my golbal income. Do I have to pay taxes in US for the capital gain and interest income that I receive from USA? Do I have to file the 1040NR?

Regards
Lekshmi

Lekshmi:

You need to file Form 1040NR to report the capital gians and interest income.

If the income is less than $3,300, you will owe NO taxes, as your personal exemption of $3,300 will offset the income.

If you were present in the U.S. for more than 183 days during the year, then you need to include the capital gains on your Form 1040NR. For years that you are not present in the U.S. for more than 183 days, then you, as a nonresident alien, will not be taxed in the US on your capital gains. In addition, interest earned during periods when you are a nonresident (and you are not engaged in a U.S. trade or business) will either be exempt from U.S. tax or the only tax due will be withheld from interest paid to you.

IntlTax is correct.

However, banking and brokergae institutions will withhold 30% of the proceeds from stock sales and banks will withhold 30% of interest earned unless you take steps to inform them of oyur tax exempt status.
To get the withheld taxes back, you will have to file the Form 1040NR.