Why Bay Area tech workers need a specialist CPA
The average Bay Area tech worker's tax return involves RSUs vesting and selling (with varying cost basis methods), ESPP shares, potential alternative minimum tax (AMT) from ISO options, and possibly equity in startups with 83(b) elections or QSBS treatment.
Add Indian financial accounts — a PPF account, Indian mutual funds, a joint account with parents in India, or rental income from property in Bangalore — and you now have FBAR (FinCEN 114) and potentially FATCA (Form 8938) obligations on top.
A general-practice CPA who isn't familiar with these forms may either miss them entirely (exposing you to $10,000+ penalties per missed filing) or over-report (triggering unnecessary tax on amounts that the US-India DTAA exempts).
FBAR vs FATCA: what Bay Area NRIs need to know
FBAR is filed separately from your tax return (on FinCEN's website) and is required if your foreign accounts had an aggregate value over $10,000 at any point during the year. This includes NRE accounts, NRO accounts, FDs, PPF (though there's some debate on PPF), and savings accounts.
FATCA (Form 8938 attached to your 1040) has higher thresholds ($50,000 for single filers, $100,000 for joint) and covers a broader range of financial assets including Indian mutual funds and ULIPs.
The good news: NRE interest income is generally tax-free under Indian law, and the US-India DTAA provides mechanisms to avoid double taxation. The bad news: applying the DTAA treaty correctly requires the CPA to understand both the treaty provisions and how to claim them on a US return.
RSU taxes: what Bay Area CPAs often get wrong
RSUs vest as ordinary income — that part is usually handled correctly. The complexity comes when you sell.
If you sell RSUs on vesting day (common for tax withholding purposes), it's a wash — your cost basis equals the fair market value on vest date. But if you hold and sell later, you have a capital gain or loss on top of the ordinary income already recognized.
The error many CPAs make: using the wrong cost basis method, resulting in either overpayment or underpayment. For shares sold from the same lot at different times, the lot selection method (FIFO, specific identification) matters — especially in a volatile stock.