[mtax]

Hi
I have moved to India in Dec'08 from US , however I have exceeded no. of days in India , and I am considered resident in india for tax purpose. As a result I have to go through double taxation.

I have some questions -

1. When I was in US , I received bonus in US on Sep'08. However that bonus was because of my work in past year. May'07-June08. In india I have to pay tax on my global income from April08-March09. Now my question is bonus paid in US on Sep'08 is for May07-June08, which means only April08-June08 period bonus should be part of my global income for april08-march09.

Can you please let me know that this is a valid assumption?

2. For calculations, what currency conversion rate should be used? Should it be as per actual dates when the salary was credited in US or it should be 12/31/2008?

3. Is there any way to get credit for social security or medicare paid in US for that time?

Thanks in advance!

[AtlantaTaxExpert]

1) I am not sure that the bonus income must be included on your Indian tax return, but it definitely must be included on your U.S. income tax return.

2) Use the conversion rate when the salry was credited.

3) No.

[mtax]

Thanks for the reply? For currency rate, salary was credited every 15 days , so do I need to take average currency rate ?

[AtlantaTaxExpert]

You CAN use an average rate, but you need to be consistent and use the average throughout the return, not just when it comes to crediting the income.