Estate tax in the USA for non-residents

Question

I read that the estate tax for non-residents on their US assets can go up to 40% with the first $60000 tax exempt. Suppose, as a non-resident, I have a brokerage account holding US stocks with the Indian arm of a US broker. Will this account be subject to US estate tax laws or Indian estate tax laws for my beneficiary after I die?

Answer 1

You will be subject to the laws of whichever country you are a tax resident of. Simply owning US stocks does not make you a tax resident of the United States. Normally, in order to be a tax resident of the United States, you have to live and work in the United States to be a tax resident here. The IRS has published guidelines to help determine US tax residency status.

Stocks in U.S. companies are considered "US-situated assets" no matter whether they are held by a foreign or domestic broker and are therefore subject to US estate taxes according to current law.

Answer 2

irs.gov/individuals/international-taxpayers/some-nonresidents-with-us-assets-must-file-estate-tax-returns

Deceased nonresidents who were not American citizens are subject to U.S. estate taxation with respect to their U.S.-situated assets.

U.S.-situated assets include American real estate, tangible personal property, and securities of U.S. companies. A nonresident’s stock holdings in American companies are subject to estate taxation even though the nonresident held the certificates abroad or registered the certificates in the name of a nominee.

So the answer is that my account will be subject to US estate tax laws.