US Green Card curbs: Can Indians keep their overseas assets?

Indians working in the US are asking one question after the green card news: if I move back, what happens to my money? The good news is that you keep what you own.

Can Indians keep their US investments after returning home?

The US has not cancelled green cards or H-1B visas. On October 8, it barred eight tech companies, reportedly including Microsoft, Infosys, TCS and Wipro, from PERM, the first step employers use to sponsor green cards. Workers at those firms who haven't started the process are stuck for now. Existing visas and green cards stay valid, as India's foreign ministry confirmed on October 9.

Your US shares: Keep them

India doesn't make you sell them. For two to three years after returning, you're in a tax grace period called RNOR, and profits from selling foreign shares aren't taxed in India. Afterwards they are, and you must list foreign assets in your tax return. The US may still levy estate tax on US shares and a 401(k).

Your bank savings: Switch quickly

Tell your bank when you return so your NRE and NRO accounts become normal resident accounts. Leaving them unchanged breaks India's foreign exchange law (FEMA), with fines up to three times the amount involved. A resident foreign currency (RFC) account lets you keep dollars, and its interest is tax-free during the grace period.

Property: Keep it

Indian property needs no special steps. A US home can be kept too: rent is taxed in India once you're resident, with credit for US tax paid, and a sale triggers 15% US withholding but no Indian tax during the grace period.

401(k) and Social Security

Withdrawing a 401(k) early can cost a 10% US penalty plus US tax, and India may tax it too, so time withdrawals for the grace period. Under the India-US agreement, you may still receive Social Security benefits after moving.

Who gets the grace period?

You qualify if you lived abroad for 9 of the last 10 financial years, or spent 729 days or fewer in India over the last 7. Bank rules change the moment you land intending to stay, while tax status depends on days spent in India.

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