u/talkingturtle1723

If you’re a software engineer at a US company, an early employee at a startup (HR, ops, marketing, anyone with a grant), a senior person sitting on a big pile of options, or someone who just got their first RSU email and is quietly confused. Same handful of things trip everyone up, so let’s try to understand it simply - 

There are two popular types of equity compensation:

• ESOPs: You get the option to buy company shares at a fixed price later (most common at unlisted startups). Buying (a.k.a. exercising) is your call; you decide when.
• RSUs: The company just gives you shares over time (most common at listed companies). They land in your account as they "vest." Nothing to buy, nothing to decide.
• SARs: Less common, but sort of a close cousin to ESOPs. Instead of buying shares, you’re just paid the appreciation in value between grant and exercise, in cash or stock. No purchase price to arrange so no capital to put up.

Where the stock sits matters too. Indian listed company, Indian startup that isn't listed yet, or a foreign parent (US-listed tech companies mostly). This changes both how much tax you pay and what you have to declare. 

With RSUs/ESOPs, you get taxed in two tranches (most people miss this)

1. First, when the shares land in your hands (RSUs vesting, or you exercising your ESOP). The value of those shares gets added to your salary and taxed like salary. Your company cuts TDS for it.

This also happens before you've sold anything. You haven't seen a single rupee of cash, but you owe tax.

1. Second, when you actually sell the shares, you pay tax on the profit (capital gains tax). But "profit" is measured from the value on the day they vested, not from zero. You already paid tax on that first bit.

Once you're at the selling stage, roughly:

• Indian listed shares: If you sell within a year, short-term capital gains tax will be at 20%. If you hold longer than a year, long-term capital gains (LTCG) apply at 12.5%. Also note, the first ₹1.25 lakh of long-term gains each year is tax-free. 
• Startup or foreign shares (US RSUs, unlisted Indian shares): the clock is two years, not one. If you hold past two years, the LTCG is 12.5%. Sell sooner, and it's taxed at your normal income slab, which for most people earning this kind of stock is 30% +. Also note, ₹1.25 lakh benefit does not apply here, so the 12.5% hits from the first rupee of gain.

 

If your shares are in a foreign company, you need to disclose accordingly

If your shares are in a foreign company, you have to report them in a specific part of your return called Schedule FA, which means filing ITR-2, not the basic ITR-1- even if you have no capital gains. This is the one people skip without realising, and it's the one I'd flag hardest, because the penalty for not disclosing foreign assets is severe and it applies even if you owe no extra tax. It's a disclosure rule, not a tax rule.If you work for a US-based company, then the US usually withholds some tax on your shares already. You can claim credit for that in your Indian return, so the same income isn't taxed twice across both countries. However, you have to ensure you file your ITR correctly to get the benefit.

How I'd actually plan around this

If you're holding ESOPs:

• Liquidity first - Don't exercise without a real path to sell. You're taxed on today's valuation, and if that valuation drops before you can sell, that tax doesn't come back. If you're pledging shares to fund the exercise, know why, and once that goal's met, let go, don't keep paying interest on a bet that's already played out.
• Timing the exercise - Nobody can time these price swings, so exercising closer to the end of your window rather than the first day it opens usually gives you the least volatile outcome.
• Tax at exercise -Keep cash aside for the tax at exercise. It's due before you've sold anything.
• Advance tax - Company TDS only covers the salary-component tax, not capital gains tax on eventual sale. Check with your CA on advance tax if that gain is big, so you're not hit with interest at filing.

If you're holding RSUs:

• Selling is your call -You don't get a say on vesting, but you do on selling. Treat every vested tranche like a cash bonus: would you use that cash to buy this stock today? If not, sell some and put it elsewhere.
• Diversify - Don't let one stock take over your portfolio just because your employer keeps handing it to you. Your salary already depends on this company, don't let your savings depend on it too.
• Tax at vesting - This is due before you've sold a single share. Some companies auto-sell part of the shares to cover it, check your payslip or with HR to see how yours handles it.
• Advance tax - Same as ESOPs (covered above)

Equity comp sounds exciting until the tax bill shows up uninvited. Hope this helps you plan for it instead of getting surprised by it

Repost to another community

As part of my R2I series for US returnees, I’ve received a few questions regarding the management of 529 accounts for kids from India. For easy readability, I’ve compiled a list of questions in an FAQ format with my responses below - 

Does India tax the growth inside the 529 account?

Not right away. Depends on your tax status.

While you're an NRI or in RNOR, the growth inside the 529 is invisible to India. It's foreign income, and both these statuses only care about India-sourced income.

The moment you cross into ROR, the rules flip. Accounts like 401(k), IRA, UK pensions, and RRSPs got a special pass under Section 89A, basically "we won't tax you on this until you actually withdraw." A 529 is not part of that list. So once you're ROR, the interest, dividends and capital gains inside the account get taxed in India every single year as they happen, whether you touch the money or not.

What if our kid doesn't end up going to college in the US? 

Timing is everything here. Pull the money out while you're still NRI or RNOR, and you dodge the India tax problem above entirely. On the US side, you'll still owe tax plus a 10% penalty, but only on the earnings, not on what you originally put in, since that was already taxed money.

The other option, which nobody seems to actually use but exists, is to just swap the beneficiary to a sibling, cousin, or a future grandkid. This is not a taxable event.

Can we use the 529 for an Indian university instead?

Only if that exact college is on the US Department of Education's Title IV list, basically their official list of foreign schools approved for US federal aid (you can check via the Federal School Code Lookup). A few hundred schools worldwide are on it. From what I know, no Indian university is currently on that list, but let me know if you've come across one that works.

So, should we keep the 529 plan or close it out before we leave?

This comes down to how real the US-education goal still is for you. If there's a genuine chance your kid, a sibling, or a future family member studies in the US, the RNOR window plus the beneficiary-change option make holding on worthwhile. If that goal has changed, running the numbers on a non-qualified (early) withdrawal while you are still an NRI or RNOR is worth an actual conversation with an advisor, rather than defaulting to "just leave it and see."

Does moving back to India put our 529 at risk of US estate tax?

Counterintuitively, no, and this is actually one of the 529's better-kept features. It's specifically excluded from your taxable estate even though you keep full control of it the whole time. Custodial accounts (UGMA/UTMA) don't get that same protection. If the parent who contributed the money is also the custodian, estate tax thresholds apply to these custodial accounts.

To summarise, in my opinion, if the 529 isn't a substantial part of your total net worth and there's no real US education goal for your kid in the short term, it's probably worth closing while you're still NRI or RNOR. Once you're ROR, you'll need to file Schedule FA on it, and the accrued growth becomes taxable in India too, so there are more pain points.

As part of my R2I series for US returnees, I’ve received a few questions regarding the management of 529 accounts for kids from India. For easy readability, I’ve compiled a list of questions in an FAQ format with my responses below - 

Does India tax the growth inside the 529 account?

Not right away. Depends on your tax status.

While you're an NRI or in RNOR, the growth inside the 529 is invisible to India. It's foreign income, and both these statuses only care about India-sourced income.

The moment you cross into ROR, the rules flip. Accounts like 401(k), IRA, UK pensions, and RRSPs got a special pass under Section 89A, basically "we won't tax you on this until you actually withdraw." A 529 is not part of that list. So once you're ROR, the interest, dividends and capital gains inside the account get taxed in India every single year as they happen, whether you touch the money or not.

What if our kid doesn't end up going to college in the US? 

Timing is everything here. Pull the money out while you're still NRI or RNOR, and you dodge the India tax problem above entirely. On the US side, you'll still owe tax plus a 10% penalty, but only on the earnings, not on what you originally put in, since that was already taxed money.

The other option, which nobody seems to actually use but exists, is to just swap the beneficiary to a sibling, cousin, or a future grandkid. This is not a taxable event.

Can we use the 529 for an Indian university instead?

Only if that exact college is on the US Department of Education's Title IV list, basically their official list of foreign schools approved for US federal aid (you can check via the Federal School Code Lookup). A few hundred schools worldwide are on it. From what I know, no Indian university is currently on that list, but let me know if you've come across one that works.

So, should we keep the 529 plan or close it out before we leave?

This comes down to how real the US-education goal still is for you. If there's a genuine chance your kid, a sibling, or a future family member studies in the US, the RNOR window plus the beneficiary-change option make holding on worthwhile. If that goal has changed, running the numbers on a non-qualified (early) withdrawal while you are still an NRI or RNOR is worth an actual conversation with an advisor, rather than defaulting to "just leave it and see."

Does moving back to India put our 529 at risk of US estate tax?

Counterintuitively, no, and this is actually one of the 529's better-kept features. It's specifically excluded from your taxable estate even though you keep full control of it the whole time. Custodial accounts (UGMA/UTMA) don't get that same protection. If the parent who contributed the money is also the custodian, estate tax thresholds apply to these custodial accounts.

To summarise, in my opinion, if the 529 isn't a substantial part of your total net worth and there's no real US education goal for your kid in the short term, it's probably worth closing while you're still NRI or RNOR. Once you're ROR, you'll need to file Schedule FA on it, and the accrued growth becomes taxable in India too, so there are more pain points.

If you’re a software engineer at a US company, an early employee at a startup (HR, ops, marketing, anyone with a grant), a senior person sitting on a big pile of options, or someone who just got their first RSU email and is quietly confused. Same handful of things trip everyone up, so let’s try to understand it simply - 

There are two popular types of equity compensation:

• ESOPs: You get the option to buy company shares at a fixed price later (most common at unlisted startups). Buying (a.k.a. exercising) is your call; you decide when.
• RSUs: The company just gives you shares over time (most common at listed companies). They land in your account as they "vest." Nothing to buy, nothing to decide.
• SARs: Less common, but sort of a close cousin to ESOPs. Instead of buying shares, you’re just paid the appreciation in value between grant and exercise, in cash or stock. No purchase price to arrange so no capital to put up.

Where the stock sits matters too. Indian listed company, Indian startup that isn't listed yet, or a foreign parent (US-listed tech companies mostly). This changes both how much tax you pay and what you have to declare. 

With RSUs/ESOPs, you get taxed in two tranches (most people miss this)

1. First, when the shares land in your hands (RSUs vesting, or you exercising your ESOP). The value of those shares gets added to your salary and taxed like salary. Your company cuts TDS for it.

This also happens before you've sold anything. You haven't seen a single rupee of cash, but you owe tax.

1. Second, when you actually sell the shares, you pay tax on the profit (capital gains tax). But "profit" is measured from the value on the day they vested, not from zero. You already paid tax on that first bit.

Once you're at the selling stage, roughly:

• Indian listed shares: If you sell within a year, short-term capital gains tax will be at 20%. If you hold longer than a year, long-term capital gains (LTCG) apply at 12.5%. Also note, the first ₹1.25 lakh of long-term gains each year is tax-free. 
• Startup or foreign shares (US RSUs, unlisted Indian shares): the clock is two years, not one. If you hold past two years, the LTCG is 12.5%. Sell sooner, and it's taxed at your normal income slab, which for most people earning this kind of stock is 30% +. Also note, ₹1.25 lakh benefit does not apply here, so the 12.5% hits from the first rupee of gain.

 

If your shares are in a foreign company, you need to disclose accordingly

If your shares are in a foreign company, you have to report them in a specific part of your return called Schedule FA, which means filing ITR-2, not the basic ITR-1- even if you have no capital gains. This is the one people skip without realising, and it's the one I'd flag hardest, because the penalty for not disclosing foreign assets is severe and it applies even if you owe no extra tax. It's a disclosure rule, not a tax rule.If you work for a US-based company, then the US usually withholds some tax on your shares already. You can claim credit for that in your Indian return, so the same income isn't taxed twice across both countries. However, you have to ensure you file your ITR correctly to get the benefit.

How I'd actually plan around this

If you're holding ESOPs:

• Liquidity first - Don't exercise without a real path to sell. You're taxed on today's valuation, and if that valuation drops before you can sell, that tax doesn't come back. If you're pledging shares to fund the exercise, know why, and once that goal's met, let go, don't keep paying interest on a bet that's already played out.
• Timing the exercise - Nobody can time these price swings, so exercising closer to the end of your window rather than the first day it opens usually gives you the least volatile outcome.
• Tax at exercise -Keep cash aside for the tax at exercise. It's due before you've sold anything.
• Advance tax - Company TDS only covers the salary-component tax, not capital gains tax on eventual sale. Check with your CA on advance tax if that gain is big, so you're not hit with interest at filing.

If you're holding RSUs:

• Selling is your call -You don't get a say on vesting, but you do on selling. Treat every vested tranche like a cash bonus: would you use that cash to buy this stock today? If not, sell some and put it elsewhere.
• Diversify - Don't let one stock take over your portfolio just because your employer keeps handing it to you. Your salary already depends on this company, don't let your savings depend on it too.
• Tax at vesting - This is due before you've sold a single share. Some companies auto-sell part of the shares to cover it, check your payslip or with HR to see how yours handles it.
• Advance tax - Same as ESOPs (covered above)

Equity comp sounds exciting until the tax bill shows up uninvited. Hope this helps you plan for it instead of getting surprised by it

https://preview.redd.it/1diav119x4ih1.png?width=962&format=png&auto=webp&s=484cce239f90d40e419b863e91dea118c8a01726

On July 15, 2026, Stripe and PE firm Advent International jointly offered $60.50 per share to acquire PayPal. That's a $53 billion deal, a 28% premium, backed by $50 billion in bank financing. If accepted (still under PayPal board review), PayPal delists and becomes a jointly-owned private company.

Which raises a question for every PayPal employee: What happens to my RSUs?

Four possible scenarios:

1. Vested RSUs get cashed out at $60.50 per share. Cash in your account. Done.
2. Unvested RSUs get "rolled over" into the new private company at the same vesting schedule, but now as illiquid private equity.
3. Unvested RSUs accelerate (rare, only with "single trigger" clauses).
4. Unvested RSUs get cancelled if you're terminated post-deal (common "double trigger" structure).

Why this matters for anyone holding RSUs at a listed company

"Listed company" doesn't mean "safe RSU forever." A take-private transaction can happen to any listed company and fundamentally changes what your equity is worth.

Key clauses to check in your equity plan document:

• Change of control definition
• Vesting acceleration (full or partial? single or double trigger?)
• Termination protection window
• Rollover conversion formula

If you hold RSUs at a listed company and have never read your equity plan document, this deal is a good excuse to do it this weekend.

Question: have you actually read your company's "change of control" clause?

Once you become ROR (Resident Ordinarily Resident), India taxes the yearly growth in your 401(k), IRA, or RRSP even if you never make any withdrawals. Keep in mind that countries like the US, Canada, and a few others tax only withdrawals. This mismatch creates an issue as you can end up paying tax twice with no credit to offset it.

Form 10-EE under Section 89A is the fix for this. File this form for that account, and India will hold off taxing its growth until you actually withdraw, matching how the US, UK, or Canada already tax it.

What you should know:

1. The accounts that actually qualify are traditional ones: 401(k) and traditional IRA in the US, RRSP in Canada. UK pensions, including SIPPs, generally fit this same test, though the department hasn't published a named list. The Explanation to Section 89A says a specified account is one where the income is taxed by such country at the time of withdrawal or redemption. So for accounts like Roth IRA or Roth 401k, withdrawal isn't taxed by the US at all, so there's no future foreign tax event for India to defer to.

 

This unclear tax treatment of Roth makes it likely that growth will be taxed in India every year. I’ve seen cases where folks have tried to claim deferral of ROTH under section 89A but received scrutiny notices in the last few years.

2. The clock starts in your first ROR year, not the year you moved back. RNOR years don't count.

3. File it on the income tax portal by your ITR due date; it's a separate form, not part of the return itself. Miss that date and the deferral is gone for good. Use a qualified CA to help you with this, as it’s not that simple and you would not want to take a risk on this one.

4. It doesn't replace Schedule FA. You still report the account every year either way.

5. Keep in mind, if you’re on a trial period in India (testing out life in India) and move abroad again and become NR under Indian rules, the election is treated as if it never happened from that point on. What this means is all the deferred growth gets taxed in one shot, in the year right before you become NR again.

Suppose Priya works in the US for ten years and her 401(k) grows to 400k. Once she returns to India, RNOR for two years covers her, and she doesn’t need to declare her foreign assets or file Form EE, as India doesn’t tax her income during these 2 years. Then in her first ROR year she files 10-EE, and for the next five years the account grows quietly, and none of it shows up on her Indian tax bill; the deferral works exactly as intended.

Then she gets a job offer back in the US. The moment she becomes NR again, the deferral collapses. Say that account grew 150k over those five years; all of it gets added to her Indian income for the year right before she left, taxed in one shot, even though the money is still sitting untouched and she won't withdraw it for another twenty years.

That's the real shape of this provision. It protects you cleanly while you stay put, and turns on you the moment your residency changes, whether or not you've touched the money.

The whole point of 10-EE is to match India's tax timing to when the money actually leaves the account, or when money is withdrawn from the retirement accounts. That only holds as long as you stay resident; the moment you're not, the timing snaps back apart. If there's any chance you might move again, get a cross-border advisor to map this out before you file, not after. Hope this saves someone a scramble :)

Once you become ROR (Resident Ordinarily Resident), India taxes the yearly growth in your 401(k), IRA, or RRSP even if you never make any withdrawals. Keep in mind that countries like the US, Canada, and a few others tax only withdrawals. This mismatch creates an issue as you can end up paying tax twice with no credit to offset it.

Form 10-EE under Section 89A is the fix for this. File this form for that account, and India will hold off taxing its growth until you actually withdraw, matching how the US, UK, or Canada already tax it.

What you should know:

1. The accounts that actually qualify are traditional ones: 401(k) and traditional IRA in the US, RRSP in Canada. UK pensions, including SIPPs, generally fit this same test, though the department hasn't published a named list. The Explanation to Section 89A says a specified account is one where the income is taxed by such country at the time of withdrawal or redemption. So for accounts like Roth IRA or Roth 401k, withdrawal isn't taxed by the US at all, so there's no future foreign tax event for India to defer to.

 

This unclear tax treatment of Roth makes it likely that growth will be taxed in India every year. I’ve seen cases where folks have tried to claim deferral of ROTH under section 89A but received scrutiny notices in the last few years.

2. The clock starts in your first ROR year, not the year you moved back. RNOR years don't count.

3. File it on the income tax portal by your ITR due date; it's a separate form, not part of the return itself. Miss that date and the deferral is gone for good. Use a qualified CA to help you with this, as it’s not that simple and you would not want to take a risk on this one.

4. It doesn't replace Schedule FA. You still report the account every year either way.

5. Keep in mind, if you’re on a trial period in India (testing out life in India) and move abroad again and become NR under Indian rules, the election is treated as if it never happened from that point on. What this means is all the deferred growth gets taxed in one shot, in the year right before you become NR again.

Suppose Priya works in the US for ten years and her 401(k) grows to 400k. Once she returns to India, RNOR for two years covers her, and she doesn’t need to declare her foreign assets or file Form EE, as India doesn’t tax her income during these 2 years. Then in her first ROR year she files 10-EE, and for the next five years the account grows quietly, and none of it shows up on her Indian tax bill; the deferral works exactly as intended.

Then she gets a job offer back in the US. The moment she becomes NR again, the deferral collapses. Say that account grew 150k over those five years; all of it gets added to her Indian income for the year right before she left, taxed in one shot, even though the money is still sitting untouched and she won't withdraw it for another twenty years.

That's the real shape of this provision. It protects you cleanly while you stay put, and turns on you the moment your residency changes, whether or not you've touched the money.

The whole point of 10-EE is to match India's tax timing to when the money actually leaves the account, or when money is withdrawn from the retirement accounts. That only holds as long as you stay resident; the moment you're not, the timing snaps back apart. If there's any chance you might move again, get a cross-border advisor to map this out before you file, not after. Hope this saves someone a scramble :)

Once you become ROR (Resident Ordinarily Resident), India taxes the yearly growth in your 401(k), IRA, or RRSP even if you never make any withdrawals. Keep in mind that countries like the US, Canada, and a few others tax only withdrawals. This mismatch creates an issue as you can end up paying tax twice with no credit to offset it.

Form 10-EE under Section 89A is the fix for this. File this form for that account, and India will hold off taxing its growth until you actually withdraw, matching how the US, UK, or Canada already tax it.

What you should know

1. The accounts that actually qualify are traditional ones: 401(k) and traditional IRA in the US, RRSP in Canada. UK pensions, including SIPPs, generally fit this same test, though the department hasn't published a named list. The Explanation to Section 89A says a specified account is one where the income is taxed by such country at the time of withdrawal or redemption. So for accounts like Roth IRA or Roth 401k, withdrawal isn't taxed by the US at all, so there's no future foreign tax event for India to defer to.

 

This unclear tax treatment of Roth makes it likely that growth will be taxed in India every year. I’ve seen cases where folks have tried to claim deferral of ROTH under section 89A but received scrutiny notices in the last few years.

2. The clock starts in your first ROR year, not the year you moved back. RNOR years don't count.

3. File it on the income tax portal by your ITR due date; it's a separate form, not part of the return itself. Miss that date and the deferral is gone for good. Use a qualified CA to help you with this, as it’s not that simple and you would not want to take a risk on this one.

4. It doesn't replace Schedule FA. You still report the account every year either way.

5. Keep in mind, if you’re on a trial period in India (testing out life in India) and move abroad again and become NR under Indian rules, the election is treated as if it never happened from that point on. What this means is all the deferred growth gets taxed in one shot, in the year right before you become NR again.

Suppose Priya works in the US for ten years and her 401(k) grows to 400k. Once she returns to India, RNOR for two years covers her, and she doesn’t need to declare her foreign assets or file Form EE, as India doesn’t tax her income during these 2 years. Then in her first ROR year she files 10-EE, and for the next five years the account grows quietly, and none of it shows up on her Indian tax bill; the deferral works exactly as intended.

Then she gets a job offer back in the US. The moment she becomes NR again, the deferral collapses. Say that account grew 150k over those five years; all of it gets added to her Indian income for the year right before she left, taxed in one shot, even though the money is still sitting untouched and she won't withdraw it for another twenty years.

That's the real shape of this provision. It protects you cleanly while you stay put, and turns on you the moment your residency changes, whether or not you've touched the money.

The whole point of 10-EE is to match India's tax timing to when the money actually leaves the account, or when money is withdrawn from the retirement accounts. That only holds as long as you stay resident; the moment you're not, the timing snaps back apart. If there's any chance you might move again, get a cross-border advisor to map this out before you file, not after. Hope this saves someone a scramble :)

Amazon laid off more people yesterday. Global layoffs are on the rise this year, and the Indian workforce seems to be taking the brunt of it with many of my friends and family living with the quiet stress of a potential income loss right now. It is a vulnerable spot to be in, especially with dependents at home. So I wanted to share a few things that I’ve been recommending to friends and family as well, in case you ever see a layoff heading your way (feel free to add more in the comments) -

1. Know your actual expenses for each month - Capture the actual outflow, including rent, EMIs, groceries, school, house help, subscriptions, SIPs. Every layoff decision (how much emergency fund you need, how long your runway lasts, what to cut first) is built on top of this number.

2. Understand your loans - Know your EMI, your prepayment terms, and whether your bank offers an EMI holiday or restructuring. Don’t panic and try to foreclose the loan and block your liquidity. Managing debt in these times is more about managing temperament.

3. Build a real emergency fund -  If you are scared, it’s a signal to start accumulating 6 to 12 months of monthly expenses in liquidity (not in stocks or MFs). In a layoff, you cannot afford to sell equity when markets are down or wait for redemption cycles. Cash needs to be cash, and it needs to be there from day 1.

4. Get your own health and term insurance - Corporate cover ends the day you leave. Buying a policy afterwards is harder because pre-existing conditions come with 2 to 4 year waiting periods, and anything diagnosed during a coverage gap may be excluded entirely. If you can afford to pre-pay the premium for the next 2-3 years, it’s practically a good choice to make.

5. Do not touch long-term money first - EPF, PPF, retirement funds, and long-term equity are the last resort, not the first. Every rupee pulled out of a compounding bucket costs you more

6. Talk with your family -  If you are single-income, it will definitely get tougher. The most important thing is to align your partner and family on what the next 4-6 months without a salary would actually look like. A few important things like school fees and healthcare for an elderly parent will be the priority. Expenses like house help, big purchases need to be moderated or wait for some time.

7. Do not make big money decisions in the first 30 days (if layoff happens) - Panic and time pressure hit at the same time, which is exactly when the worst decisions get made. Don’t 'Hate-Sell' your vested RSUs at whatever price is showing that week, don’t take personal loans to build artificial liquidity, don’t sign exit paperwork without reading, don’t accept the first job offer at 20% less than fair.

8. Negotiate the severance package (if layoff happens) - The layoff decision is fixed, but the package usually is not. You can often push for a longer notice period and most people accept whatever HR offers on the first call. Even a polite email asking for specifics can change the numbers.

9. Don’t fall for the herd - During these times, it’s natural for folks to form groups and get on a hate-train and lose yourself in the noise. Take some time to accept the pain and try finding avenues that help you get your career back on track.

These suggestions may seem simple or obvious, but not many people actually sit down to plan for a worst-case situation, because no one wants to see it coming

Amazon laid off more people yesterday. Global layoffs are on the rise this year, and the Indian workforce seems to be taking the brunt of it with many of my friends and family living with the quiet stress of a potential income loss right now. It is a vulnerable spot to be in, especially with dependents at home. So I wanted to share a few things that I’ve been recommending to friends and family as well, in case you ever see a layoff heading your way (feel free to add more in the comments) -

1. Know your actual expenses for each month - Capture the actual outflow, including rent, EMIs, groceries, school, house help, subscriptions, SIPs. Every layoff decision (how much emergency fund you need, how long your runway lasts, what to cut first) is built on top of this number.

2. Understand your loans - Know your EMI, your prepayment terms, and whether your bank offers an EMI holiday or restructuring. Don’t panic and try to foreclose the loan and block your liquidity. Managing debt in these times is more about managing temperament.

3. Build a real emergency fund -  If you are scared, it’s a signal to start accumulating 6 to 12 months of monthly expenses in liquidity (not in stocks or MFs). In a layoff, you cannot afford to sell equity when markets are down or wait for redemption cycles. Cash needs to be cash, and it needs to be there from day 1.

4. Get your own health and term insurance - Corporate cover ends the day you leave. Buying a policy afterwards is harder because pre-existing conditions come with 2 to 4 year waiting periods, and anything diagnosed during a coverage gap may be excluded entirely. If you can afford to pre-pay the premium for the next 2-3 years, it’s practically a good choice to make.

5. Do not touch long-term money first - EPF, PPF, retirement funds, and long-term equity are the last resort, not the first. Every rupee pulled out of a compounding bucket costs you more

6. Talk with your family -  If you are single-income, it will definitely get tougher. The most important thing is to align your partner and family on what the next 4-6 months without a salary would actually look like. A few important things like school fees and healthcare for an elderly parent will be the priority. Expenses like house help, big purchases need to be moderated or wait for some time.

7. Do not make big money decisions in the first 30 days (if layoff happens) - Panic and time pressure hit at the same time, which is exactly when the worst decisions get made. Don’t 'Hate-Sell' your vested RSUs at whatever price is showing that week, don’t take personal loans to build artificial liquidity, don’t sign exit paperwork without reading, don’t accept the first job offer at 20% less than fair.

8. Negotiate the severance package (if layoff happens) - The layoff decision is fixed, but the package usually is not. You can often push for a longer notice period and most people accept whatever HR offers on the first call. Even a polite email asking for specifics can change the numbers.

9. Don’t fall for the herd - During these times, it’s natural for folks to form groups and get on a hate-train and lose yourself in the noise. Take some time to accept the pain and try finding avenues that help you get your career back on track.

These suggestions may seem simple or obvious, but not many people actually sit down to plan for a worst-case situation, because no one wants to see it coming

If you work at one of the tech giants or any US company that grants you RSUs, this affects you.

What does this mean for you?

CBDT issued an order on July 8, 2026, authorising the Income Tax Department to auto-populate foreign financial data (received under the Automatic Exchange of Information framework) directly into your AIS and Form 26AS. This covers calendar years 2022 through 2025 and will appear in time for the return you file this July.

What does this mean?

Your US brokerage holdings, RSU vestings, dividends, and sale proceeds will now show up in the tax department's system automatically.

Why this matters for RSU holders

If you've been quietly not disclosing your vested RSUs in Schedule FA (Foreign Assets) of your ITR, this year is the year it catches up with you.

• Every RSU vesting from your US employer = a foreign asset that must be disclosed in Schedule FA
• Every dividend from those shares is foreign income that goes under Schedule OS, with the underlying holding still showing up in Schedule FA
• Every sale of vested shares is a capital gain that goes under Schedule CG
• Every US tax withheld = foreign tax credit you claim via Form 67

What to do before you file your ITR this year (deadline: July 31, 2026)

1. Check your AIS on the income tax portal. See what foreign data is already populated.
2. Reconcile it against your Fidelity/Schwab/E*Trade statements
3. Disclose every vested RSU holding in Schedule FA (even if you haven't sold)
4. File Form 67 before your ITR if claiming foreign tax credit on US withholding