First I want to make sure that you know that you have to use the exchange rate at the date of purchase and then the exchange rate on the date of sale , and the difference in the USD amount between ex rate on the date of purchase and ex rate on the date of sale determines the gain/loss on the property for US taxes.
There is also a possible mortgage gain if you settled a mortgage with the sale of this property. This gain would be considered ordinary income. https://www.ustaxfs.com/foreign-mortgage-repayment-exchange-rate-gain/
To report your Indian tax paid on your gain for foreign tax credit:
- Enter foreign tax credit in the search box at the top of the page and click the Jump to link
- Click 'Yes" you paid foreign taxes
- Click through the screens regarding foreign interest and dividends
- Click yes that you have reported all your foreign income already in TurboTax
- Click that you want to take a credit
- Answer question about the Simplified Limitation Election
- Choose income type land sale - it will be Passive Income
- Add India as the country
- Enter description -Indian Land sale
- Enter Income amount that you
previously reported in TurboTax- Enter Total Proceeds not the gain
- Enter your taxes you paid on your foreign income in the box "Other income"
- Continue through ALL the foreign tax credit screens until done.