H-1B Plan B: the money checklist if you have to leave the US suddenly

Much of the current anxiety comes from measures that are proposed, limited in scope or before the courts. For an Indian already working in the US on an H-1B, the practical risks are a shorter window to leave after a job ends and long waits for visa stamping in India, not the headline fee. Check the current position before acting, because each item below can change.

Status summarised from published reports of US court orders, the Federal Register and the US State Department as at 9 November 2026. Confirm the current position with a US immigration attorney before you travel or plan a departure.

A planned return is sequenced over twelve months: the landing date, RSU vests, 401(k) treatment and Indian bank accounts are lined up so the RNOR window does the work. A forced exit compresses that into weeks. The costly mistakes are made under time pressure: cashing out retirement accounts, selling shares at the wrong time, losing access to US accounts, and landing in India on a date that shifts the Indian tax year. A one-page Plan B, prepared while you are still employed, removes most of that risk. For the full timeline, see the 12-month USA return checklist.

A 401(k) or IRA can stay invested after you leave the US. Withdrawals before age 59½ generally carry a 10% US additional tax on top of ordinary income tax, so a panic cash-out can cost a third or more of the balance. Once you are resident and ordinarily resident in India, Section 158 (earlier section 89A), claimed on Form 40 (earlier Form 10EE), can align Indian tax with the year of withdrawal for accounts in notified countries, including the US. If your employer plan does not allow you to stay, a rollover to an IRA usually keeps the tax deferral. An HSA balance also remains yours after you leave. See RSU, ESOP and foreign retirement funds on return.

Under most US equity plans, unvested RSUs lapse when employment ends, while vested shares remain yours in the brokerage account. List every vest date for the next twelve months now, so you know what a layoff in any given month would cost and which vests a negotiated exit date could protect. RSUs are US wages at vesting, sourced by where you worked during the vesting period; if a vest lands after you become Indian resident, India can tax the part attributable to Indian workdays, with credit for US tax claimed on Form 44 (earlier Form 67). Vested shares you keep become foreign assets, and gains on a later sale are taxable in India once you are ordinarily resident.

Some US brokers and banks restrict or close accounts once the holder is no longer a US resident, and updating the address after you leave can trigger that review. Before any exit, check each provider's policy for non-US residents, set up online access and two-factor authentication that works with an Indian number, keep one US bank account open for final pay, refunds and closing payments, and consolidate scattered brokerage accounts with a provider that serves non-residents. Indian mutual funds held while you are a US person raise separate US reporting issues; see the India-US DTAA guide.

In the year you leave, most H-1B holders file as dual-status: US resident for the part of the year before departure and non-resident afterwards, subject to the closer-connection and residency-termination rules. State tax, final paycheck withholding, severance and accrued leave all fall into this return. Departing non-citizens are generally expected to obtain a certificate of tax compliance (the sailing permit) before leaving. US Social Security contributions do not transfer to India, because the two countries have no totalization agreement; your credits stay on your US record.

Indian residency follows days physically present in India, not visa status. Under Section 6 you are resident if you spend 182 days in India in the tax year, or 60 days in the year plus 365 days over the previous four years; the 60-day limb is relaxed for citizens visiting India, not for someone returning to settle. An H-1B holder who has visited India for only a few weeks a year may not meet the 365-day condition, so even a landing in December can leave that tax year non-resident. Where you do become resident, you will often be RNOR for the first years back, keeping foreign-source income outside Indian tax. Count the days from passport records before you book. See residential status under Section 6.

Open or refresh NRE, NRO and, if you hold foreign currency, FCNR accounts while you are still non-resident, and complete KYC and the PAN residential-status update. That way severance, vested shares and savings can move to India the week you need them, with a clean source-of-funds trail. After you return to settle, redesignate NRE and FCNR accounts to resident or RFC accounts. An RFC account lets you keep foreign currency rather than converting everything to rupees on arrival. See NRE, NRO and FCNR after return.

Keep one document, updated each quarter: your next twelve RSU vest dates; 401(k), IRA and HSA balances and plan rules for leavers; every US bank and brokerage account with its policy for non-residents; your India day count for the last four tax years; your NRE, NRO and FCNR details; and the name of a US immigration attorney and an Indian chartered accountant you can call in the same week. Most H-1B holders will never need it, but those who have it make calmer decisions if the visa position changes.