Tax Queries 2024

[eshwarm]

Tax Queries
1. Tax Savings Options for Married Filing Jointly:

     How can we save on taxes? What are the different tax savings options available for those who are married and filing jointly?

2. Tax Credits and Benefits for Home Purchase and Solar Installation:

I bought a house in a new construction community in November 2024 in San Diego, CA. I have also purchased a solar + battery system that cost me $30,000. Can I claim credits for this expense on my taxes? Are there any other exemptions or benefits I can opt for?

3. Investment Options for NRIs and Tax Implications:

I am a citizen of India and planning to invest in the Indian stock market. Is it better to invest in the Indian stock market using US ETFs, index funds, or brokerage platforms? Or is it suggested to open an NRE (Non-Resident External) or NRO (Non-Resident Ordinary) bank account that allows NRIs to invest in Indian mutual funds and stocks directly? Is it easy to move money from an NRE account back to the USA? What are the tax rules applied by the USA? I read that an NRE account is tax-free in India, so is it advantageous if we move the funds along with capital gains to the USA? Does it work if we move back funds to India?

[ThomasM125]

One good strategy to reduce your tax burden is to contribute a retirement plan either at work or on your own through an individual retirement account (IRA). If you invest in a Roth retirement account, your contributions won't be deductible but you won't have to pay tax on disbursements you take in retirement. A contribution to a traditional retirement account will be deductible in most instances but distributions from it in retirement are taxable.

The solar battery system purchased as an improvement to your home may entitle you to a residential clean energy credit of up to 30% of the cost of the equipment. You can learn more about that in this IRS article:

Residential Clean Energy Credit 

I'm not authorized to give investment advice, so maybe someone else can comment on investment strategies for you.

[DavidD66]

The main thing you can do to save on your taxes if you are married is to file jointly.  You almost always pay less tax if you file jointly vs. filing separately.  Instead of specific options being available if you are married filing joint, there are restrictions and limitations on what you can do if you file separately.  The question What are the different tax savings options available to those who are filing jointly?"  is too broad to be answered on this forum.  Eligibility for most tax saving options are dependent on the specific circumstances of the taxpayer(s).   

As for your questions about Investment options, those are questions better suited for an investment advisor that works with Indian citizens living in the US.  Your questions are beyond the scope of our US tax expertise and could constitute providing investment advice, which we are prohibited from doing.