Moving from India to the US Tax Checklist: Before, During and After Arrival

A moving from India to the US tax checklist has to cover two tax systems that change your status on different dates. India stops treating you as an ordinary resident based on days in India and your reason for leaving; the U.S. starts taxing your worldwide income based on your visa and days in the U.S. The gap between the two creates the planning window. The steps below suit an engineer arriving in Aurora on an H-1B or L-1, a spouse on H-4, or a family that has just received a green card.

Step 1: Plan your Indian residential status before you leave

The Income Tax Department's non-resident FAQ explains the Indian tests. An individual is resident for a year if present 182 days or more, or 60 days or more in the year plus 365 days or more in the four preceding years. For an Indian citizen who leaves India for employment abroad, only the 182-day test applies. These tests are the same under the Income-tax Act, 1961 (for years that begin before April 1, 2026) and the Income-tax Act, 2025 (for later years). The "not ordinarily resident" label depends on how many of the last ten years you were non-resident and how many days you spent in India in the last seven.

Because India's year runs April to March, leaving in August means roughly 130 days in India that year. Leaving in November puts you past 182 days, and you stay resident for that whole year, so Schedule FA and Indian tax on your US salary can become issues. Your Indian Chartered Accountant confirms your status; our India residency guide lists the tests.

Step 2: Fix Indian accounts and investments

1. Tell each bank about your change of status. The RBI says a resident account should be designated as an NRO account when a resident becomes non-resident, and you can open NRE accounts for repatriable money. See NRE, NRO and FCNR accounts.
2. Review mutual funds, ULIPs and endowment policies before you become a U.S. resident. Indian mutual funds are usually passive foreign investment companies for U.S. purposes, and gains that built up before arrival are taxed in the U.S. if you sell later, because your U.S. cost basis is generally your original cost. Selling earlier may keep that gain outside U.S. tax but triggers Indian tax; run the numbers first. Our Form 8621 guide explains the PFIC rules.
3. Decide what happens to your EPF, NPS and PPF accounts; see retirement planning across the three countries.
4. Collect your last three Indian returns, Form 16, Form 26AS or AIS, loan statements and property documents. U.S. lenders and immigration cases ask for them.
5. Keep a list of every account, folio and policy with opening date, balance and holder names.

Step 3: Work out when U.S. residency begins

IRS Publication 519 gives two tests. You are a resident for the whole calendar year if you hold a green card at any time in the year (the green card test, with residency starting on the first day you are in the U.S. as a lawful permanent resident), or if you pass the substantial presence test: at least 31 days in the current year and 183 days counting all of this year, one-third of last year and one-sixth of the year before. Days as an F-1 student or J-1 exempt individual generally do not count for the first years. If you meet neither test in the arrival year but meet the substantial presence test in the next year, you can make a first-year choice to be a resident from the first day of a run of at least 31 consecutive days, provided you were present at least 75% of the days from that date to December 31. See our U.S. residency tests.

Step 4: File the arrival-year return correctly

• Dual-status return: In a year when you are partly a resident and partly a nonresident, Publication 519 says you cannot take the standard deduction, cannot use head of household rates and cannot file jointly, although you may itemize. A spouse who is a U.S. citizen or resident allows the election to treat both of you as residents for the whole year.
• Due dates: For a nonresident or dual-status filer with wages subject to withholding, the due date is April 15; without such wages, June 15 of the next year.
• Apply for an SSN after arrival; an ITIN is for those who cannot get an SSN. See our SSN and ITIN guide.
• Illinois: the state treats domicile as the test of residence, so the arrival year can be a part-year resident return. See the IDOR IL-1040 instructions.
• Form 8833: if you rely on a treaty position, disclose it.

Step 5: Start your foreign-account reports in the first resident year

Once you are a U.S. resident, FBAR applies if your foreign accounts together exceed $10,000 at any time in the year, and Form 8938 applies at the thresholds in its instructions (for example, more than $50,000 at year-end or $75,000 at any time for an unmarried taxpayer living in the U.S.). Interests in foreign pension plans are reportable on Form 8938, and the Form 8938 instructions explain how to value them. Indian-resident readers who visit us after a return to India should also read moving from the U.S. to India.

Moving from India to the US tax checklist at a glance

Worked example

Meera, a software engineer from Bengaluru, arrives in Aurora on August 10, 2026 on an H-1B with no earlier U.S. stay. By December 31 she has been present 144 days, so she does not meet the substantial presence test for 2026 and is a nonresident alien for 2026. Her Indian salary before departure is not U.S. income. Her 2026 return is a Form 1040-NR (due April 15, 2027 because she has wages with withholding). In 2027 she is a resident for the whole year, so she reports worldwide income, files an FBAR for her NRO and NRE accounts if they exceed $10,000, and reviews her mutual funds for Form 8621. All dates and figures are hypothetical.

Mistakes to avoid

• Leaving bank accounts as resident accounts after you have become non-resident under Indian foreign-exchange rules.
• Selling Indian mutual funds after arrival without checking PFIC rules.
• Assuming your arrival year is automatically a full resident year.
• Ignoring Indian filing in the year you leave.

How we can help

We build the U.S. side of your relocation plan in Aurora and across the Fox Valley: residency analysis, the arrival-year return, SSN and ITIN steps, FBAR, Form 8938 and PFIC reporting. For Indian filings and FEMA account changes, we coordinate with your Chartered Accountant. See our relocation and immigration tax planning service. Immigration status questions belong with an immigration attorney.

Frequently asked questions

General information only. It is not tax, legal, accounting or immigration advice for your situation, and rules change; confirm the current rules with the official source or a licensed professional in the relevant country.