What Americans Living in India Need to Know in 2025

As an American residing in India, staying informed about the latest tax regulations and financial obligations is crucial to ensure compliance and optimize your financial well-being. In 2025, several significant changes have been introduced that directly impact U.S. citizens living abroad. This guide will walk you through the key updates and what they mean for you.

Americans living in India: Visa types

If you’re an American considering permanent residency in India, it’s important to understand the available visa options. Below are the primary pathways to establish long-term residence:

Overseas Citizen of India (OCI)

Who it’s for: Individuals of Indian origin or those married to Indian citizens.

Overview: The OCI card grants a lifetime visa to India, allowing multiple entries and indefinite stay. While it offers many rights similar to Indian citizens, it does not confer political rights such as voting or holding public office.

Requirements:

• Proof of Indian origin (e.g., previous Indian citizenship, or parents/grandparents/great-grandparents who were Indian citizens).
• For spouses: Must be married to an Indian citizen or an existing OCI cardholder for at least two years.
• Applicants must not have ever been a citizen of Pakistan or Bangladesh.

Permanent Residency Status (PRS) for Foreign Investors

Who it’s for: Foreign investors willing to make significant financial investments in India.

Overview: The PRS scheme offers a 10-year residency permit, extendable for another 10 years, to foreign investors who meet specific investment and employment criteria.

Requirements:

• Minimum investment of ₹10 crore (approximately $1.5 million) within 18 months or ₹25 crore (approximately $3.8 million) within 36 months.
• The investment must generate employment for at least 20 resident Indians every financial year.
• PRS holders can purchase one residential property for dwelling purposes.
• Spouses and dependents are permitted to work in the private sector and pursue studies in India.

Employment Visa Leading to Residency

Who it’s for: Highly skilled professionals and qualified workers with a job offer from an Indian company.

Overview: Employment visas are typically issued for up to five years and can be extended. Continuous employment and compliance with visa conditions can pave the way toward long-term residency.

Requirements:

• A valid employment contract with an Indian company.
• The position should require specialized skills or qualifications.
• Minimum annual salary of $25,000 (exceptions apply to certain professions).
• The applicant must work exclusively for the sponsoring employer in India.

Residency by Marriage

Who it’s for: Foreign nationals married to Indian citizens.

Overview: Marriage to an Indian citizen can provide a basis for long-term residency. After registering the marriage, the foreign spouse can apply for an entry visa, which can be converted to a long-term visa or residence permit.

Requirements:

• Legally registered marriage to an Indian citizen.
• Proof of cohabitation and a stable relationship.
• Intent to reside permanently in India with the spouse.

Navigating India’s residency options can be complex. It’s advisable to consult with immigration experts or legal professionals to determine the best pathway based on your individual circumstances.

How to apply for an Indian visa as a U.S. citizen

Applying for an Indian visa as an American involves several steps, which can vary depending on the visa type. Here’s a clear, step-by-step overview to help you get started:

1. Identify the right visa category

Decide whether you qualify for an OCI card, Permanent Residency Status, Employment Visa, or Entry/Marriage Visa based on your circumstances.

2. Gather required documentation

Collect documents such as your valid U.S. passport, passport-size photos, proof of eligibility (e.g., employment contract, marriage certificate, or investment documents), and completed application forms specific to your visa type.

3. Complete the online application

Visit the official Indian visa application portal or the OCI portal for OCI applications. Fill out the relevant forms accurately, upload digital copies of your documents, and print the completed application.

4. Submit your application and pay fees

Submit your application either online or at your nearest Indian consulate or visa center. Pay the applicable visa or processing fees—these vary by visa type.

5. Attend a biometric appointment or interview

Some visa types require you to attend an in-person appointment for biometrics or an interview. You’ll be notified if this step applies to your application.

6. Track your application and await approval

Use the online tracking system to monitor your application status. Processing times differ based on the visa category and your personal circumstances. Once approved, follow the instructions to collect your visa or OCI card.

Healthcare options for Americans living in India

Navigating healthcare in India as an American expat can feel daunting at first, but understanding the system and your choices helps you make confident, informed decisions for yourself and your family.

How India’s healthcare system works

India has a dual healthcare system:

• Public healthcare: Government hospitals and clinics offer free or low-cost services, but these can be crowded and may have limited resources, especially outside major cities.
• Private healthcare: Private hospitals and clinics are widely available in cities, offering high-quality care, modern facilities, and English-speaking staff. These services come at a higher cost, but many expats find them comparable to those in the U.S.

Health insurance is not mandatory, but having coverage is strongly recommended for expats, as out-of-pocket expenses can add up, especially in private facilities.

Healthcare options for Americans living in India

As an American in India, you have several options:

• Local insurance plans: Many Indian insurers offer plans tailored for expats, covering treatment in private hospitals.
• International health insurance: These policies provide broader coverage, often including medical evacuation and access to care in other countries.
• Pay-as-you-go: Some expats pay out of pocket for routine care, given the relatively lower costs compared to the U.S., but this approach is risky for emergencies or serious illnesses.

It’s important to choose a plan that fits your needs, taking into account pre-existing conditions, access to preferred hospitals, and whether you travel frequently outside India.

Pros and cons of healthcare for American expats living in India

Pros:

• Access to high-quality, English-speaking medical professionals in private hospitals.
• Lower costs for most medical procedures and consultations compared to the U.S.
• Availability of both local and international insurance options.

Cons:

• Public healthcare may not meet the standards you’re used to in the U.S., especially in rural areas.
• Navigating insurance and billing can be complex.
• Out-of-pocket costs for emergencies or specialized care can be significant without proper insurance.

Weighing these factors carefully helps you make the best choice for your situation while living in India.

Cost of living for American expats living in India

Understanding the cost of living in India compared to the U.S. can help you plan your budget with confidence. Many expats are pleasantly surprised by how far their dollars stretch, but there are a few surprises along the way. Here’s a quick look at everyday expenses:

Category	India (Major Cities)	United States (National Average)
Groceries	$100–$150/month/person	$300–$400/month/person
Housing (1BR apt, city center)	$250–$500/month	$1,500–$2,500/month
Transport (local, monthly pass)	$10–$20	$70–$100
Phone plan (mobile, 5GB data)	$3–$7/month	$30–$50/month

Pros and cons of the cost of living in India for American expats

Pros:

• Your everyday spending on food, housing, and transport is significantly lower than in most U.S. cities.
• Affordable domestic help and services can free up your time.
• Eating out and entertainment are budget-friendly, letting you enjoy a vibrant social life.

Cons:

• Imported goods and certain familiar brands can be expensive or hard to find.
• Quality and comfort in housing may differ from U.S. standards, especially outside metropolitan areas.
• You may need to adjust to local products, foods, and shopping habits, which can take some getting used to.

We know adjusting to a new cost of living can be a big part of your expat journey. Comparing your expected expenses can help you feel prepared and make smart choices as you settle into life in India.

Where do American expats tend to live in India?

While you’ll meet Americans throughout India, a few cities and neighborhoods tend to be especially popular:

• Mumbai: As India’s financial and entertainment capital, Mumbai attracts professionals, entrepreneurs, and families. Areas like Bandra, Powai, and Colaba are favored for their international schools, expat communities, and Western-style amenities.
• Delhi (and Gurgaon): Many American expats working in business, education, or diplomacy choose Delhi. Nearby Gurgaon is known for its expat-friendly housing complexes, shopping malls, and international offices.
• Bangalore: Known as India’s tech hub, Bangalore draws American tech professionals, startups, and digital nomads. Neighborhoods like Indiranagar and Whitefield have plenty of cafes, coworking spaces, and social events.
• Pune: With its universities, research centers, and growing IT sector, Pune is a quieter alternative to the major metros. Expats here often appreciate the milder climate and relaxed pace.

Tax implications for Americans living in India

Navigating taxes as an American living in India can feel overwhelming. You’re not alone if you’re wondering how U.S. tax rules apply to you, what Indian tax authorities expect, or how to avoid paying too much tax. 

American expats’ tax obligations

Even if you haven’t set foot in the U.S. for years, the IRS still expects you to file an annual U.S. tax return. This rule applies whether you live in Mumbai, Bangalore, or a quiet town in Kerala.

• Who must file: All U.S. citizens and green card holders with income above the IRS threshold must file—no matter where you earn it.
• What’s taxable: The U.S. taxes its citizens on worldwide income. That means salary, rental income, or investments—whether earned in India, the U.S., or elsewhere—must be reported.
• Deadlines: While the standard deadline is April 15, expats get an automatic extension to June 15, and can request an additional extension to October.

Indian taxes

Living and working in India means you may also have to pay Indian income tax, depending on your residency status and the source of your income.

• Residency matters: If you spend 182 days or more in India in a tax year, you’re generally considered an Indian resident for tax purposes.
• Taxable income: Indian residents are taxed on their global income, while non-residents are taxed only on Indian-source income.
• Filing requirements: The Indian tax year runs April to March, with returns typically due by July 31. Indian tax rates and brackets are quite different from those in the U.S., and deductions/exemptions also vary.
• Double taxation concern: Sometimes income can be taxed by both countries—this is where credits and treaties come in.

Foreign Earned Income Exclusion (FEIE)

The Foreign Earned Income Exclusion (FEIE) is a big advantage for many Americans abroad.

• How it works: For tax year 2025, you can exclude up to $130,000 of foreign-earned income from your U.S. tax return (the amount adjusts annually).
• Eligibility: You must pass either the Physical Presence Test (330 days in a foreign country during a 12-month period) or the Bona Fide Residence Test.
• Limits: This exclusion applies only to earned income (like salary), not passive income (like dividends or rental profits).

Foreign Tax Credit (FTC)

The Foreign Tax Credit helps prevent double taxation by giving you a dollar-for-dollar credit for income taxes paid to India.

• How it helps: If you pay income tax in India on income also taxed by the U.S., you can claim a credit on your U.S. return.
• Limits: The credit can’t exceed the U.S. tax payable on the same income.
• When to choose: Sometimes, it’s better to claim the FEIE, sometimes the credit—sometimes both. We help you choose what’s right for your unique situation.

Tax treaty

The United States and India have a tax treaty designed to avoid double taxation and clarify which country gets to tax certain types of income.

• What it covers: The treaty addresses issues like residency, pensions, dividends, and more.
• Limitations: Not all types of income are covered, and the rules can be complex. For example, Social Security benefits are generally only taxed by the U.S.
• Why it matters: Understanding the treaty can save you from paying more than you need to—or missing an exemption you’re entitled to.

Reporting foreign bank accounts

If you have financial accounts in India (or anywhere outside the U.S.), you may need to report them to the U.S. Treasury.

• FBAR: If the total value of your foreign accounts exceeds $10,000 at any point during the year, you must file an FBAR (FinCEN Form 114).
• FATCA: Some Americans must also file Form 8938 (FATCA) with their tax return if their foreign assets exceed certain thresholds.
• Penalties: Not reporting can lead to steep fines, so it’s important to stay compliant.

Social Security

Social Security can be confusing for expats, especially when you’re working in India.

• U.S. Social Security: If you’re working for a U.S. employer, you may still pay into the U.S. Social Security system. If you’re working for an Indian employer, generally you pay into India’s system.
• Totalization agreement: The U.S. and India do not currently have a totalization agreement, so time worked in India typically doesn’t count toward U.S. Social Security credits.

Ready to take control of your finances and make informed decisions? Don’t wait—apply these tips today and set yourself up for success. If you have more questions or need expert guidance, reach out to our expert tax team for personalized support.

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