Which tense should be used with 'thought'?

Question

1. I thought you were a doctor.

2. I thought you are a doctor.

What is the major difference between these two?

Also, when can we use 'thought' in the present tense?

Answer 1

Example 1 is correct. Example 2 doesn't follow the correct sequence of tenses.
If you use quotes about what you were thinking to yourself, you might use present tense in the quotation:

I thought "She is a doctor."

"Thought" can be a noun. As a verb, it is the past tense of "think".