By Saurabh Garg, founder·11 min read·Published 2026-06-11

Sell Property in India from the USA: The Complete Process

You can sell property in India while living in the USA without flying back, but the sale runs on two tax systems at once, and only one of them is optional to get wrong. India collects TDS at the sale and wants a return. The IRS wants the same gain reported on your US return, in dollars, the same year. This guide covers both halves: the India-side mechanics of executing a sale from the USA, and the US-side reporting once the money lands.

For the remote-execution basics common to any NRI, read selling without visiting India and the general NRI selling guide. For the treaty mechanics behind the tax credit, read the DTAA guide for US property owners. This page is the USA-specific playbook: the exact POA route for a US passport or an OCI card, and what your US CPA needs from the India side.

The POA route from the USA

You do not need to be in India to sign the sale deed. A registered power of attorney lets someone in India sign on your behalf. The process, as documented in our POA from USA to India guide, runs:

  1. Draft with an Indian property lawyer, naming the property, the exact powers (negotiate, sign the sale deed, appear before the sub-registrar, receive consideration), and your attorney holder.
  2. Sign before a US notary with two independent witnesses who are not immediate family.
  3. Apostille at the Secretary of State of the notarizing state, if you hold a US passport or another foreign passport. Indian passport and OCI holders can skip straight to consulate attestation.
  4. Attest through the Indian consulate via VFS Global. Since 1 August 2025, consular attestation in the USA runs through VFS, not walk-in at the consulate. Government fee runs around USD 20 per POA per executant plus a VFS service charge, per the CGI San Francisco advisory.
  5. Courier the original to India. The delivery date starts the stamping clock.
  6. Adjudicate within three months. Under Section 18 of the Indian Stamp Act, 1899, an instrument executed abroad must be stamped by the Collector of Stamps within three months of arrival in India. Miss it and the POA gets impounded, with duty and penalty owed before it can be used.
  7. Register the POA, since it authorizes a sale. Post-Suraj Lamp, sub-registrars will not act on an unregistered POA for a property transfer.

Use a Special Power of Attorney limited to this one sale, not a General POA. It is the document your attorney holder, the buyer, and the buyer's bank will all scrutinize, so get it clean the first time.

The sale deed, TDS, and the lower-deduction certificate

Once the POA is registered, your attorney holder signs the sale deed as your attorney and completes registration at the sub-registrar's office. That part is mechanical. The tax withholding is where a USA-based seller loses cash they did not expect to lose.

Because you are an NRI, the buyer withholds tax under Section 195, not the 1 percent that applies to a resident seller under Section 194-IA. The deduction runs on the full sale price, at the long-term capital gains rate of 12.5 percent plus surcharge and cess, working out to 13 to 14.95 percent depending on the sale value, per the TDS on sale of property by NRI guide on this site. That guide has the exact slab table and the buyer's compliance steps.

Left alone, TDS at 14.95 percent of the full price can withhold far more than your actual tax on the gain. The fix is a lower or nil deduction certificate, filed as Form 13 (now Form 128 under the Income-tax Act, 2025) with the jurisdictional assessing officer before the sale closes. It typically takes three to eight weeks to issue, so file it the day a price is agreed, not the week of registration. The certificate caps the buyer's deduction at your actual computed gain instead of the full sale value, which is the difference between having cash to move and having it stuck with the tax department for a year.

The buyer deposits the TDS and issues you Form 16A. Keep it. Your US CPA needs the exact rupee amount deducted and the date, to compute the Form 1116 credit correctly.

Getting the money to the USA

Sale proceeds go into your NRO account. From there, repatriation is capped at USD 1 million per financial year under FEMA, using Form 15CB (a CA's certificate) and Form 15CA (your online declaration). The NRO repatriation guide covers the documents and edge cases. This step is identical for a USA-based seller and any other NRI seller: nothing in the mechanics changes because the destination is the USA rather than the UK or the UAE.

Reporting the sale on your US return

This is the part specific to being a US tax resident, and the part most sellers underestimate. The IRS taxes US citizens and residents on worldwide income, so the Indian property sale is a reportable US event whether or not any money ever crossed a border.

Form 8949 and Schedule D. You report the sale on Form 8949, which reconciles the transaction details, and the subtotal carries to Schedule D of Form 1040, where your gain or loss is calculated. The IRS describes Form 8949 as reconciling sale proceeds against your basis for a capital asset (irs.gov/forms-pubs/about-form-8949). A foreign property that never generated a Form 1099-S still gets reported the same way; you just will not have a US broker statement to reconcile against.

Computing basis and gain in dollars. Everything on the US return is in USD. Your basis is the original purchase price converted at the exchange rate on the date you acquired the property (or, for inherited property, its fair market value on the date of the decedent's death, also converted to USD). The sale proceeds convert at the exchange rate on the date of sale. Because the rupee has weakened against the dollar over most multi-year holding periods, the dollar-denominated gain is often smaller than the rupee gain India taxes, and in some years a seller shows an Indian profit and a US loss on the same transaction. Keep the purchase deed, any improvement invoices, and a documented exchange-rate source, because the IRS can ask you to substantiate basis years after the sale.

The Form 1116 credit. File Form 1116 with your Form 1040 to claim credit for the Indian tax paid on the gain (irs.gov/forms-pubs/about-form-1116). The credit is for tax actually paid or accrued to India, not the TDS withheld in isolation: use the final Indian tax liability from your Indian return once filed, not just the Form 16A withholding figure, since TDS and final liability can differ if you claimed a section 54 exemption or filed for a refund. The credit is capped at the US tax attributable to that same income and cannot exceed it. The DTAA guide explains why the treaty itself gives no rate reduction on property gains: Article 13 lets each country tax under its own law, and the credit is the only relief mechanism.

Depreciation recapture, if the property was ever a US-reported rental. If you rented the property out at any point and reported that rental income on Schedule E with depreciation deductions, the sale triggers Section 1250 treatment on the portion of the gain attributable to depreciation claimed. That "unrecaptured section 1250 gain" is taxed at a maximum rate of 25 percent, higher than the standard long-term capital gains rates of 0, 15, or 20 percent (IRS Topic 409, irs.gov/taxtopics/tc409). This applies regardless of whether the property was in India or Ohio: US tax law does not distinguish by property location once you have depreciated an asset on a US return. Total up every year of depreciation you claimed on that property. It reduces your basis and increases the ordinary-rate portion of your gain, whether or not you remember claiming it.

Where this goes wrong

Run this as one transaction, not two filings that happen to be about the same property

66 MG Road handles the India side end to end for USA-based owners: the POA route through VFS and Indian adjudication, the sale deed and registration, the lower-TDS certificate application, and repatriation through Forms 15CB and 15CA. We package the Indian tax computation and Form 16A documentation the way a US CPA needs it for Form 8949, Schedule D, and Form 1116, so the two filings tell the same story instead of fighting each other. Teams in Mumbai, Pune, Bangalore, Hyderabad, Chennai, and Gurgaon. Itemized billing, no percentage cut of the sale.

Saurabh Garg, founder, 66 MG Road

FAQ

Can I sell my property in India while living in the USA without traveling? Yes. A registered power of attorney, notarized in the USA, apostilled or consulate-attested, and stamped in India within three months of arrival, lets a trusted person in India sign and register the sale deed for you. You approve terms remotely and the sale proceeds go to your NRO account.

Do I have to report the sale on my US taxes if the money never left India? Yes. The US taxes citizens and residents on worldwide income. The sale is reportable on Form 8949 and Schedule D in the year of sale, regardless of whether the proceeds are repatriated, held in your NRO account, or reinvested in India.

How much TDS will the buyer withhold, and does that count as my final US tax credit? The buyer withholds 13 to 14.95 percent of the full sale price under Section 195, unless you hold a lower-deduction certificate. That withholding is not your final Indian tax liability. Use the actual Indian tax computed on your Indian return, not the raw TDS figure, when you claim the Form 1116 credit, since the two can differ.

What if I claimed depreciation on this property on a past US tax return? The gain attributable to that depreciation is taxed as unrecaptured Section 1250 gain at a maximum 25 percent rate on the US return, separate from the rest of the long-term gain. Add up every year of depreciation claimed before you estimate your US tax on the sale.

How is my basis calculated if I bought the property decades ago in rupees? Convert the original purchase price to USD at the exchange rate on the date of purchase, or, for inherited property, use the fair market value on the date of death converted to USD.

Can the DTAA reduce my US tax on the sale? No. Article 13 of the India-USA treaty lets each country tax the gain under its own law. The treaty's benefit is the Form 1116 foreign tax credit for Indian tax paid, not a lower rate on either side. See the DTAA guide for the full mechanics.

Will my US state tax the gain too? Most states tax the gain and give no credit for Indian tax paid. Model state tax as a separate, uncreditable cost before you agree a sale price, especially in California or New York.

Sources

Information on this page is as on 2026-06-11. Rules, rates, deadlines and government portals change without notice, so verify against the official source before you act. This page is for information only. It is not tax or legal advice, and it is not a substitute for a qualified adviser who knows your position.