Your essential guide to U.S.-India tax compliance under the OBBBA legislation.
1. Key Deadlines for 2026
| Date | Deadline Description | Who It’s For |
|---|---|---|
| Jan 15, 2026 | Final Q4 2025 Estimated Payment | Self-employed & Investors |
| Mar 16, 2026 | Business Tax Deadline | Partnerships & S-Corps |
| Apr 15, 2026 | Tax Day & FBAR Deadline | All U.S. Persons |
| Jun 15, 2026 | Automatic Expat Extension | Residents living outside the U.S. |
| Oct 15, 2026 | Final Extension Deadline | Individuals with Form 4868 |
2. 2026 High-Value Thresholds (OBBBA Adjusted)
- Foreign Earned Income Exclusion (FEIE): $132,900 per person. (Up from $130,000 in 2025).
- Standard Deduction (Married Joint): $32,200.
- 1% Remittance Fee: Applies to cash-based/physical money transfers sent from the U.S. to foreign countries (effective Jan 1, 2026).
- Exit Tax Exclusion: $910,000 of unrealized gain is exempt for 2026 expatriations.
3. Asset Disclosure Cheat Sheet
Use this checklist to ensure no Indian asset is missed on your FBAR or Form 8938 (FATCA):
- Bank Accounts: Savings, NRO, NRE, FCNR, and Fixed Deposits (FDs).
- Retirement: EPF (Provident Fund), PPF, and NPS.
- Investments: Mutual Funds (PFICs), ULIPs, and Demat Equity accounts.
- Insurance: Any LIC policy with a Cash Surrender Value.
- Business: Shares in an Indian Private Limited Company.
4. The KKCA Compliance Workflow
How we get you from “Statement” to “Submission” in 5 steps:
- Data Capture: You upload Indian statements to our secure portal.
- Rupee Conversion: We apply the 2025 Treasury Exchange Rates to all peak balances.
- PFIC Calculation: We perform Mark-to-Market (MTM) analysis on your mutual fund NAVs.
- Treaty Check: We apply the U.S.-India DTAA to claim your Foreign Tax Credits.
- Final Review: A 2-partner sign-off ensures your FBAR and 1040 are perfectly reconciled.
The “Red Flag” Warning
The IRS AI Matching System is now live. For 2026, the IRS automatically cross-references your Schedule B interest income against your FBAR peak balances. A mismatch of more than 5% can trigger an automated “Soft Letter” inquiry.
Looking for personalized tax services about your specific tax situation, please contact us. We are here to help you with your specific tax matters.
Disclaimer
This blog is intended for informational purposes only and does not constitute legal or tax advice. Please consult a qualified U.S. CPA or tax attorney for guidance specific to your situation.