1. PFIC Rules and Partnership Election PFIC (Passive Foreign Investment Company) rules typically apply to foreign mutual funds, like Indian AIFs, due to their structure and passive income focus. IRS Form 8832 allows an Indian AIF to elect to be treated as a partnership rather than a corporation for U.S. tax purposes. Without this election,…

Here’s a breakdown of Sharia-compliant funds for Muslim investors: 1. What Are Sharia-Compliant Funds? Sharia-compliant funds strictly follow Islamic law (Sharia) to ensure ethical and permissible investments. These funds avoid investments in sectors that are Haram (forbidden), such as: Riba (Interest): No interest-based income, like bonds or savings accounts. Gharar (Uncertainty): Avoidance of speculative or…

Here’s how wealthy Indians are minimizing their tax liabilities on mutual fund capital gains: 1. Double Tax Avoidance Agreement (DTAA) DTAA prevents double taxation on the same income—once in India and once in the country of residence. Some countries, including the UAE, do not specifically address “income from mutual funds” under DTAA, making it tax-free…