Foreign Bank account - Transferred money to US, have Interest :: Need help

[mithoo28]

Tax Experts, @ThomasM125 @JohnB5677 

I am a US citizen and have a bank account in India. We had some agricultural land that we sold in 2021 and got money deposited in NRO account (joint with spouse). Now, at one point of time during year - we had around ~$200k and then we got ~110k transferred to our bank in US (joint account) in November. Based on reading comments - I downloaded interest statement (1/1/2021 to 31/12/21) and it comes out ~$6000. Bank also deducted TDS ~$2000 for same period. Now, I need help in validating few points that I learnt from this community:

1. I have to show max amount ~$200k in form 8938. Do I need to show or add interest too in 8938 OR where we added other 1099INT even it is less than $10000?

2. Should I use ~$2000 as foreign tax credit and enter that also in turbo tax?

3. Is there any further action for money transferred since it is from our NRO account to our US account?

4. I will also be filing FinCEN 114 (FBAR) is my understanding.

Am I missing anything? Is this right way of handling this situation?

Please guide and help!

Thanks

[LoganathanB]

Yes, you are on the right track

1. You have to show the maximum amount that was in your account during 2021. No, you do not have to add interest in 8938. You enter the interest in Schedule B

2. Yes you can use $2000 paid as tax and claim the foreign tax paid credit.

3. No further action is required.

Foreign Tax Credit

[mithoo28]

Thanks @LoganathanB ! Appreciate it.

Now, after reading posts another question has popped up. As mentioned, this was rural agricultural land in India that we sold. Rural land is not considered as capital asset as per Indian rules so there is no capital gains as such. Since the proceeds from that sales were deposited in my NRO account and then transferred to my US account.

Question is - Do I need to worry about any sort of capital gains calculations using consumer index here in my US taxes? OR no issues since this transfer is from my account so no details need to be provided?

Thanks

[mithoo28]

Should i just file form3520 for the money received from this inherited property sale?

[RobertB4444]

@mithoo28  Yes.  Inheritances are not taxable.

[mithoo28]

So, confusion now is that form 3520 only works if someone else sends you money as inheritance. In our situation, we got our money transferred from Indian NRO account to our US account. Amount repatriated was from selling a rural agricultural land in India. This is not considered as capital asset there and we don't need to worry about any capital gains. I am assuming that same rule will apply in US taxes and I will not consider any capital gains.

Is this correct assumption?