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    Ranjana's Avatar
    Ranjana Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Apr 2, 2005, 06:58 PM
    Worldwide income
    Hi,
    I am filing taxes as a resident and have a question
    About declaring my worldwide income.

    I have income from India from bank account and bonds interest
    And dividends from mutual funds. However in India dividends are not
    Taxable and bank interest below INR 12,000 is not taxable.

    Also in India, interest from investment up to INR 70,000 per year
    In Public Provident Fund (state sponsored retirement account
    Similar to IRA in US) is tax free. Moreover this interest income
    Cannot be withdrawn from the account, so I am not sure if it qualifies as
    Income?

    My question is do I have to pay US taxes on all this interest and dividend income?
    After all the exemptions in India, I fall below the taxable limit in India
    And hence did not pay tax in India.

    Would really appreciate your feedback on this.
    Thanks for your time
    Ranjana :confused:
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #2

    Apr 2, 2005, 07:34 PM
    Ranjana:

    The interest from the Public Provident Fund is probably considered tax-deferred income by the Internal Revenue Code and does not need to be reported.

    The bank account and bonds interest and the mutual fund dividends would be taxable.

    Both assessments above are my opinion based my understanding of the Internal Revenue Code.

    For an expert opinion, suggest you post the question to www.thetaxguy.com, who specializes in taxes for resident and nonresident aliens.
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