You can live in India and still own an asset that is “in the US” for estate-tax purposes.

When a workplace benefit becomes a family asset

Employer equity can become a significant part of family wealth. Once an award becomes an actual share, the issuing company and legal ownership may raise questions beyond the country where you work.

The key distinction: working for a US company is not itself the issue

Your employer's nationality does not automatically create a US estate-tax problem. The more useful question is what you actually own. A grant of unvested RSUs, an unexercised option and vested shares in a US parent company are not necessarily the same legal asset.

Why an Indian employee can still have US-situated shares

Imagine an Indian national living in Bengaluru, Mumbai, Delhi, Doha or Dubai who works for an American technology company. Part of compensation arrives as RSUs. Over several years, vested shares accumulate in the US parent company. The person may never have lived in the United States. That does not by itself turn the shares into Indian-situs property for US estate-tax purposes.

IRS guidance states that stock of a corporation organised in or under US law is an example of US-situated property for this estate-tax analysis, including where certificates are held abroad or registered through a nominee.

The hidden risk often grows quietly

Employee equity can create several issues at once:

• Concentration: salary, career and investments may all depend on one employer.
• Estate exposure: vested US-parent shares may be US-situated assets.
• Succession: beneficiaries may need to deal with a foreign broker, plan administrator or US transfer process.
• Local tax: selling, transferring or restructuring can have Indian or residence-country tax consequences.
• Currency: the asset may be USD-denominated while future liabilities are in INR, GBP, AED or another currency.

The $60,000 figure is a filing threshold — not a simple “tax-free allowance” calculation

For a nonresident who is not a US citizen, the executor generally has to consider Form 706-NA when the date-of-death value of relevant US-situated assets, together with specified gifts, exceeds the $60,000 filing threshold. The actual tax computation is more complex and can involve deductions, credits, the worldwide estate and treaty provisions where a death-tax treaty applies.

The IRS unified estate-tax rate schedule is progressive from 18% to a top marginal rate of 40%. This is why multiplying the entire portfolio by 40% is not an accurate general calculation.

An illustrative portfolio

An employee owns $300,000 of vested shares in a US parent company, has $150,000 of unvested RSUs, and separately owns Indian mutual funds, Indian property and INR deposits.

• The vested US shares are the clearest US-situs asset to flag for review.
• The unvested RSUs should be analysed under the award contract rather than automatically treated as vested stock.
• Indian property and Indian investments are not made US-situated merely because the employer is American.
• If the employee later buys other US corporate shares or US real estate, those may add to the US-situs analysis.

What happens on death can matter as much as the tax number

Where a Form 706-NA filing is required, the current IRS instructions generally require it within nine months of death unless an extension is granted. Estates may also encounter transfer-certificate requirements before certain US assets can be released. That can create an administration and liquidity issue for a family even before anyone focuses on investment performance.

A practical review checklist

• Are you a US citizen or potentially US domiciled for estate-tax purposes?
• Which awards are vested, unvested, exercised or still only contractual rights?
• Which legal entity issued the shares?
• What is the current value of directly owned US-company stock and other US-situated assets?
• Does your country have a US death-tax treaty?
• What happens to each award on death under the plan documents?
• Could diversification reduce employer concentration risk?
• Would a sale or transfer create Indian or other local tax consequences?
• Do your beneficiaries know where the assets are held and how to access the records?

Treat a vesting date as a planning checkpoint

When an award becomes available, ask what it changes in the wider household balance sheet. Salary, bonus, unvested awards and directly owned shares can all depend on one employer. A share-price fall may coincide with uncertainty at work, making the combined exposure more significant than the brokerage balance alone.

Before any sale or exercise, understand employer dealing restrictions, exercise costs, tax withholding and reporting duties. A gradual diversification plan may be worth discussing, but its timing and suitability depend on the award, restrictions, costs and personal circumstances.

Continue with the whole plan