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December 1, 2017
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December 1, 2017

Benefits of Filing U.S. Taxes

Last Update Date : April 27, 2019
Estimated Read Time: 5 min

Regardless of whether you are a U.S. citizen or a resident alien residing in the United States or abroad, the rules for filing U.S. tax returns remain the same. Resident aliens are people who hold a green card and the rules that apply to the U.S citizens apply to the green card holders as well. Whether you are in the United States, India or any other country in the world, the rules for filing estate, gift, income tax returns and estimated tax payment are the same. Your income, filing status and age determine whether or not you are required to file U.S. tax return.

Benefits of filing U.S. taxes for citizens living abroad

The tax agreement between the United States and India may eliminate or reduce double taxation of your income. While living outside the U.S., the IRS allows credit for foreign income tax that you pay. These credits might balance any U.S. tax on Indian income that you might owe. However, in order to claim this credit, you have to file your U.S. tax returns every year.

You will only increase your tax liability by not filing your U.S. tax returns. Suppose you live in India for 3 years and then you return to the United States, the IRS may question you about your failure to file your tax returns for the past 3 years. In such cases, the IRS makes assessments which are based on their best estimate of your income. If there is an interest or penalties that you have to pay on any old tax amount, it will accumulate rapidly.

Therefore, instead of the IRS seeking you out for failing to file your tax returns, filing them voluntarily can be beneficial in the following ways.

  • Foreign tax credit: If you are in India and working over here, you are likely to pay taxes in this country as well. The Foreign tax credit allows you to reduce the tax burden of double taxation. However, if you want to claim this credit, you will have to file Form 1040 and Form 1116 so that you can claim credit for payment of foreign taxes. The U.S. and India have a tax treaty that can offer additional tax benefits to you.
  • Tax Exclusions: If you wish to get the benefit of tax exclusions, you should file your taxes as exclusions are not automatic. You can claim these exclusions on Form 2555 and attach it to your Form 1040 for taking advantage of these exclusions. This form will help you determine what you qualify for and what you do not qualify for. The exclusions included are the foreign earned income exclusion and foreign housing exclusion or deduction.
  • Statute of limitations: If you file your yearly U.S. tax, the statute of limitations in maximum situations will expire 3 years after you file your returns for IRS audits, which never runs out on tax collections if you don’t file your U.S. taxes. Therefore, filing your tax return from abroad every year even if you don’t have any income can prove to be beneficial for you.
  • Tax refund: If you have paid more taxes than required then you will owe a tax refund. Only if you file your tax return you will be able to receive a refund.

Benefits of filing U.S. taxes for NRIs

Filing your U.S. taxes may sound difficult, but if you are working in U.S. or you are a student or a scholar living in U.S. then you should file U.S. tax return whether you have earned any income in the U.S. or not because there are certain benefits to filing your taxes other than it’s the law:

  • Chances of refund due to tax treaty between India and U.S: If you are an Indian, who has worked abroad or a student then you can qualify for a refund due to tax treaties and a lack of serious income in case you have earned income in U.S.
  • USA visa requirements: Indian students in U.S. should remember that if you fail to comply with U.S. tax requirements then it can result in your visa being revoked. Also, you will be unable to apply for a green card later if you wish to.
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Advantages of filing U.S. taxes with H&R Block India

As United States expats living in India are still obligated to report their income to the IRS every year, it is important to file U.S. taxes from India. You have to include all the income earned for that tax year, even the income earned through foreign employment while filing the tax returns. H&R Block India can get your U.S taxes prepared and filed while you are in India by their team of in-house tax experts. H&R Block files both Federal and State tax return. They will also help you file the report of foreign bank and financial accounts with proper tax planning and advice. H&R Block India is known for its complete assistance by a qualified tax advisor who has expertise in handling U.S. as well as India taxes. The tax advisor will help you minimize your taxes and maximize your refund.


Filing your taxes with H&R Block India has the following benefits:

  • Ensuring that you don’t face visa issues while you return to the United States
  • Claiming refund of both State and Federal Income tax that has been withheld
  • Comfort of filing your U.S. taxes from India without hassle
  • Qualified tax advisors assisting and helping you optimise your total taxes
  • Complete services, right from the preparation of tax returns to filing them
  • H&R Block is registered with IRS, and it has its EIN (Employer Identification Number). All tax advisor of H&R Block have their PTIN (Preparer Tax Identification Number) by which they can file a return on behalf of taxpayer through H&R Block and assure 100% accuracy. If any mistake is committed by the preparer, then H&R Block takes the responsibility to correct it.
  • A secure URL keeps your documents safe
  • Tax summary is prepared on your behalf which is then sent to you for approval, and you pay for your tax return

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Mohammadfaruq Memon
Mohd. Faruq Memon is the Head of U.S. Expat Tax Services at H&R Block (India) with an industry experience of fifteen years. He holds a masters-level qualification and his expertise lies in Dual Taxation. On weekends, Faruq is a movie buff who also enjoys watching cricket!

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