US tax on property sold in India if tax already paid in India

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US tax on property sold in India if tax already paid in India

I had booked a flat in India but moved to the US soon after. Upon allotment my brother in law paid for it and effectively owned it since except it stayed under my name. My brother in law has since moved to London and wants to now sell it. I don’t have an Indian account and have been told I have to open an NRO account for the sale proceeds. So far so good? I have been told that Indian authorities will charge a tax of 23% at source and I will be able to repatriate the monies to my brother in law’s account in the UK. Question I have is that will I then have to pay US tax as well effectively leading to double taxation even though I have never owned the property? Is there a more effective way?

Profile photo of Amitabh Saini Asked By: Amitabh Saini 2 replies 0 helpful answers Last Updated: 5 months, 2 weeks ago
  • Profile photo of Amitabh SainiAmitabh Saini
    Participant

    I had booked a flat in India but moved to the US soon after. Upon allotment my brother in law paid for it and effectively owned it since except it stayed under my name. My brother in law has since moved to London and wants to now sell it. I don’t have an Indian account and have been told I have to open an NRO account for the sale proceeds. So far so good? I have been told that Indian authorities will charge a tax of 23% at source and I will be able to repatriate the monies to my brother in law’s account in the UK. Question I have is that will I then have to pay US tax as well effectively leading to double taxation even though I have never owned the property? Is there a more effective way?

  • Profile photo of Rimal AjmeraRimal Ajmera
    Moderator

    Thank you for the question. you can claim your foreign tax paid by you in your US tax return. If you need any help in assisting this you can get in touch with our tax advisor.

    • Profile photo of Amitabh SainiAmitabh Saini
      Participant

      So you’re saying that I have to pay both Indian and US tax and then claim back US tax?

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