R2I Club Member Hangout

RBee wrote: ↑Mon Jan 06, 2025 11:51 am

old-spice2 wrote: ↑Mon Jan 06, 2025 10:30 am Don't keep repeating high taxes in India. For the past few years have been paying close to 47% in US and some EU countries have 50-60% (Sweden) as taxes. Only Gulf and Singapore have less taxes.

Also high taxes in India is due to lower tax exemption (Rs 2.5L) which is also due to low cost of living. I can live on $1K per month in India (with no home loan) and in BA I would get "ghanta" for $1K. Here it is min around $5K/month if I hire maid/cook. High CoL in developed countries neutralizes or makes more money to go out of your pocket compared to India. I am not even going into medical cost plus retirment home/assisted living expenses which are 20x in Bay Area compared to similar setup in India. Talking from personal experience of paying for someone in a RH in India and enquired similar setup in BA. Now stop giving this excuse!

US-NRIs feel the burn when someone says India is better in xyz thing. Burnol chahiye?

Kya baat hai, OS2 ji, aaj kal jyada gussa ho rahe ho US-NRI pe ?
BTW was curious to know did you denounce your USC after your return to India?
Else you have to pay taxes to uncle Sam as well as to India.

I will turn 48 this year and the thought of permanent return does come to me from time to time too. I am still at age to not worry about medical issues yet but want to live with my beloved mother before it is too late. But double taxation worries me a lot. How do people who have significant net worth(in US$) manage returning to India permanently, so if you can share tips on these, it would help.

"Out of the frying pan into the fire" - Renouncing USC for tax purposes makes sense if you're moving to Cayman Islands and not to India.
Exit taxes would be levied based on 'deemed distributions" and so you owe capital gains taxes even without selling any stocks/RE as if you sold them.

It was surprising to see even long-term GC holders that lived in the US for more than 8 years are subject to this exit tax. Not sure how many R2I former GC holders would be hit with the 'surprise' tax in the future.

https://www.thetaxadviser.com/issues/20 ... t-tax.html

SAPPORO wrote: ↑Mon Jan 06, 2025 9:56 pm LOL! I am glad I am not your financial advisor.
The question is not which place is better. The question is about financial implications of transferring $1M to India.
You have to consider effective rate and not the marginal tax rate since India has very less exemption, the money will be taxed at a higher in India if one loses the NRI status which is a fact.
Other things you brought out are subjective and irrelevant to the discussion.

Lot of resident Indians as well as ex-US residents living in India are making big returns in the stock market for the past 10-15 years. The average long term return has been in 15-18% range. If you are living in India one need not care about forex rate fluctuations. You earn in INR and spend in INR. One guy (USC) has invested and tripled his investments in the last decade, paying whatever taxes to IRS with PFIC regulations. He is happy with it and am going to consult his FA. Bank FD gives paltry 8% now.

Also LTCG on equities in India is 10%, half of rate in US. It used to be zero till 10 years back. Bank FD attract 30% just like here. Plus I pay additional 10% tax in state tax which is not there in India, you have only federal tax. Sales tax and prop tax kills people in CA.

Yes if someone cuts their ties to US totally, then can move $1M and SIP them for 12-15% return. I am not doing it mainly due to your friend Trump who may scrap SS payments for USC who renounce their citizenship. Next time when you meet him in FL, get an assurance he will not do it. RE prices in India is completely different animal.

RBee wrote: ↑Mon Jan 06, 2025 11:51 am Kya baat hai, OS2 ji, aaj kal jyada gussa ho rahe ho US-NRI pe ?
BTW was curious to know did you denounce your USC after your return to India?
Else you have to pay taxes to uncle Sam as well as to India.

I will turn 48 this year and the thought of permanent return does come to me from time to time too. I am still at age to not worry about medical issues yet but want to live with my beloved mother before it is too late. But double taxation worries me a lot. How do people who have significant net worth(in US$) manage returning to India permanently, so if you can share tips on these, it would help.

Gussa nahi hai! I have noticed this about US-NRI in this group as well as other WA groups. Everything in US is good and everything in India is bad is their attitude. Some go to the extent of saying Indian food available in US is better than in India. Many are stuck in US for whatever the reason and want to look good or better than people who LII or r2i. I have ability to choose where I want to live but chose India as post retirement life is better there. Filing taxes in two countries is not a big deal. I have CA in India and CPA here in US. I shall just send them the tax documents and they will take care.

One cannot have best of both worlds. Even if you pay higher taxes in India due to lower exemption, you come out way ahead due to lower CoL for other stuff. In US/EU the living expenses will outstrip whatever tax advantage you have, especially when you enter senior homes and old age medical care. At 60 I need to look at those expenses as they are round the corner. I support a family member in a senior home in India and I pay the monthly bills. So got current information and US does not come anywhere close in terms of cost and quality of service/food that is available.

I just want to bust wrong/misleading information spread by some members.

It's a fact that India has a lower COL than the US (what you get for your money is another story) but still very few decide to go back even for retirement. Wonder what gives - Maybe the fundamental reasons are that most don't want to be away from their adult kids and grandkids and one can in fact get the best of both worlds by choosing the 'world' as needed and that no one can take all the money with them when they die.

One can't sacrifice the entire retirement for the retirement home that may or may not be needed in the last couple of years of life. Even in that case, one can move to India when the retirement home is needed if it makes more financial sense. Same applies for non-emergency medical procedures.

I can create the same 'Bangalore' COL right here in Tampa. I bought a condo for 120K recently (1 Crore) in a gated community which is a better deal compared to what we can get in Bangalore, with 24-hour clean water supply and central HVAC. My wife and I can easily live there for $1500 a month but we would never do that since we don' t want to go back to where we started from 27 years ago after all the toiling AND we can't take all the money with us when we die.

You concept is not bed. But $120K for condo? where in Tampa , FL? How much is the HOA or other fees?

DILIPDE wrote: ↑Tue Jan 07, 2025 4:17 pm You concept is not bed. But $120K for condo? where in Tampa , FL? How much is the HOA or other fees?

Condos in Florida are being sold like plague, nobody wants them after recent law changes. Just look at Zillow and people are selling them at heavy losses due to unexpected costs that coming down the line. Everyone wants out now before a surveyor shows up at the door with massive bill to comply with regulation changes. And then there are ever increasing hoa fees. Condo market will get worse before it gets better.

ShrimaanJi wrote: ↑Wed Jul 17, 2024 4:07 pm Hello Friends,

Any idea where to Invest $1M dollar (first tranche) after transferring to India?. I am a USC hence may not be allowed to invest in Indian Mutual Funds unless I am in ROR (My impression. Correct me if I am wrong) status. Hence, I thought, I will transfer to HDFC NRE Account and invest in Fixed Deposits. I hope they will let me invest in FDs. I am will be completing 58 soon and will relocate to India after 3 -4 years.

Any Thoughts,

You should consult with a tax pro. I would personally not invest a whole lot in stock market at this age unless this money is more for transferring to kids and you just want to invest to pass it on. Especially now when everything is so expensive. Not sure where you heard that USC cannot invest in stock market. With your OCI you should get access to NRO account and invest your funds with ease. Apply for adhar and it will make life easy. As for taxation of funds, definitely tax profs dealing with NRIs will guide you better.

If for inheritance, I have heard that some people invest through Ireland based funds. Not sure but read on reddit that these funds are supposedly exempt from inheritance tax in the US.

People in India will try to sell you whole life insurance policies. Strictly stay away from them.

What about investing in small flats in a metro? They give 4-5% rental yields and appreciation of around 10%. Although it's at another peak cycle right now for real estate as well. That I feel is secure investment in India, if you can deal with tenants. But repatriation of that money may prove challenging for your kids if you deal with cash component.

DILIPDE wrote: ↑Tue Jan 07, 2025 4:17 pm You concept is not bed. But $120K for condo? where in Tampa , FL? How much is the HOA or other fees?

It's close to the University of South Florida, prices have gone down a little bit since summer when I bought. Looking to get a few more when it gets to less than $100k after Trump crashes the economy this year.

The condo fees are in the $300-$500 range per month but it covers the insurance for the shared areas like walls, floors, roof and so pretty much everything.
For that reason, there is no need to have the home insurance.

The general misperception of all condos crashing in value in Florida is great as an investor landlord. The condos crashing in value and literally as well, are mostly in the Miami beach area and the latest condo regulations are mostly for buildings that have at least 3 stories.

old-spice2 wrote: ↑Tue Jan 07, 2025 10:52 am Gussa nahi hai! I have noticed this about US-NRI in this group as well as other WA groups. Everything in US is good and everything in India is bad is their attitude. Some go to the extent of saying Indian food available in US is better than in India. Many are stuck in US for whatever the reason and want to look good or better than people who LII or r2i. I have ability to choose where I want to live but chose India as post retirement life is better there. Filing taxes in two countries is not a big deal. I have CA in India and CPA here in US. I shall just send them the tax documents and they will take care.

One cannot have best of both worlds. Even if you pay higher taxes in India due to lower exemption, you come out way ahead due to lower CoL for other stuff. In US/EU the living expenses will outstrip whatever tax advantage you have, especially when you enter senior homes and old age medical care. At 60 I need to look at those expenses as they are round the corner. I support a family member in a senior home in India and I pay the monthly bills. So got current information and US does not come anywhere close in terms of cost and quality of service/food that is available.

I just want to bust wrong/misleading information spread by some members.

That is bad; people should not criticize and paint bad the whole country in one broad brush.
But on the same token, I have read your posts since 2011 when I first joined the old forum. Your posts mostly had harsh words for US. Inspite of that, you have still stayed in US for another 14 years and your kids are probably born here and working here. So if the country is so bad, bay area so bad, why live here for this long or why chose to provide citizenship of this country to offsprings?

I was on H1B. Then GC and then USC. Our kids are born here. At no point, no one pointed us a gun to choose this route but we knowingly chose this path. We could have gone back to India on our own will but we chose to stay back. There are so many good things in this country that we fail to acknowledge IMO. Not trying to be preachy here but I don’t get why people have to be on extreme swings; berate India 100% or berate US 100%. There are good and bad in both but we can be reasonable in assessing them.