Income earned from NRE accounts

ned18 · #1 (**permalink**) 03-02-2015, 11:54 AM

Hi,

I have a NRE account in india(offshore account) which provides interest of 4% annually but they do not provide 1099 form showing the interest I earned for that particular year. Should I be reporting this income to IRS while filling taxes although I do file FBAR form to notify IRS of my offshore account.

My tax account says that since this money is not bought into US Banks I don't need to notify IRS. I am wondering if he is right.

Thanks For the help,

Ned

Wnhough · #2 (**permalink**) 03-02-2015, 08:17 PM

Quote:

Originally Posted by ned18

Hi,

I have a NRE account in india(offshore account) which provides interest of 4% annually but they do not provide 1099 form showing the interest I earned for that particular year. Should I be reporting this income to IRS while filling taxes although I do file FBAR form to notify IRS of my offshore account.

My tax account says that since this money is not bought into US Banks I don't need to notify IRS. I am wondering if he is right.

Thanks For the help,

Ned

It depends; aslongas you area US resident(even for tax purposes), then, you need to report your US source and world wide income on your US tax returns(fed/state) and you can claim foreign tax credit on your taxes paid to Indian taxing authority(ies) by filing form 1116 or by claiming tax deduction on Sch A of 1040 line 8.

ned18 · #3 (**permalink**) 03-03-2015, 10:24 AM

Thanks for the response, I was confirmed the same thing by one of my friends..