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USA and India DTAA: Double taxation of RSUs granted in USA and vested in India

Hello,
In March 2023 , my employment transferred from USA to India. I hold RSUs granted in CA, USA which started vesting in India.
My company reported RSUs vested in India to USA W-2 and also to India tax dept.
My RSU income is around 50k which is reported in both the countries and both the countries collected taxes.

As per substantial presence test for the year 2023, I qualify as US tax resident.
From March 2023, I dont live in the USA, until March I have USA regular wages too.

While filing taxes in USA, do I have any option to request refund/credit for the taxes I paid in India as per DTAA?
or
Do I need to pay taxes to USA as usual and request credit from India which is where I am having home and active employment and also citizen of India, per DTAA?

Please help.

Thanks,
Satish.

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1 Reply
MarilynG1
Expert Alumni

USA and India DTAA: Double taxation of RSUs granted in USA and vested in India

Yes, if you paid Foreign Tax on income that is also taxed in the US, you can claim a Foreign Tax Credit for the amount of tax paid to India.

 

In the Foreign Tax Credit section, you will need to indicate the type of income that was taxed, and the amount of Foreign Tax Paid.

 

Choose 'General Category Income' and Continue through the interview until you are asked the amount of the Income and the Amount of the Foreign Tax paid on that income.

 

Here's more info on Claiming the Foreign Tax Credit

 

 

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