[IndiaHouse]

I am an Indian born citizen of US naturalized recently.

(a) I purchased several properties over the last 5 years in India. Do I need to report those properties to IRS even though they are in India? (Please note that I rent those properties in India and pay property tax and income tax in India). If the answer is YES, given the fact that I have not reported them so far, what tax or legal implications do I face? How should I handle it?

(b) My wife owned a property in India which was purchased for her by her Dad. We sold it recently and paid off a mortgage in the US. Should we disclose this sale to IRS? If so how?

(c) Who is the right technical person to talk to about such topics? CPA or Tax Prepaper or Tax Attorney?

[MukatA]

1. A U.S. person (citizen or resident) must report world wide income of tax return.
2. When you buy property, you need not report it. When you sell a property, it must be reported on schedule D (Form 1040).
3. Both you and your wife may also need to file Form TD F 90-22.1.
Read Your U.S. Tax Return: U.S. Citizen or Resident with Foreign Income

[IntlTax]

(a) You should contact a CPA or tax attorney and have them amend the last [probably] 3 years of tax returns to include the income from the India property. You may also need to file Form TD F 90-22.1.

(b) Yes, you need to report the sale/gain on your U.S. tax return. You may also need to report the receipt of the gift if it exceeded $100,000. See Form 3520, Part IV. The penalty for failing to report the gift is 25% of the gift.

(c) The rules in the cross-border tax area are extremely complex. You should try to find someone that has experience in this area.