I am a US citizen by birth but living and working in India. Do I need to pay any kind of tax to the US govt?

Question

I have accquired a OCI i.e. an Overseas Citizenship of India recently and also got my US passport renewed. I have never been or worked in the US. I am working in India for around 2 yrs. Please let me know the details regarding taxes.

Answer 1

go here: http://www.irs.gov/faqs/faq13-7.html it explains the tax situation that you are in.

Answer 2

You may not have to pay tax on your income if it is under US$85 700. If it is over that amount, you won't have to pay tax on the first $85 700 but you will pay tax on the rest. But, all US citizens must file a tax report to the IRS even if you are living abroad permanently. The US is one of the strictest enforcers of tax, so if you don't file a tax report, you may get into trouble when returning to the US.

If you do earn over US$85 700, you may be eligible to receive foreign tax credits, which basically helps reduce double taxation, as you will be taxed in both India and the US, but you cannot claim this for your first $85 700.