Do Indian Americans in Texas Need an Indian Will for NRE and NRO Accounts?

Ramana Reddy Ireddy

Oct 31

4 min read

I frequently get this question from Indian Americans: “I have an NRE account and an NRO account in India, and I have named nominees. Do I still need an Indian will?”

It depends on your situation. If your only assets in India are a couple of bank accounts and your children are adults, nominations may be enough from a practical standpoint. But if you have minor children and want them to live with family in India if something happens to both parents, I strongly recommend an Indian will.

The important point is that a bank nomination in India does not work the same way as a beneficiary designation in Texas. And estate planning is not just about who gets the money. It is also about who takes care of your children.

Texas: A Beneficiary Designation Generally Controls Over a Will

In Texas, when an account has a valid beneficiary designation, that designation generally controls who receives the account, even if your will names someone else.

For example:

Your will leaves an account to Mr. X.
The beneficiary designation on that account names Mr. Y.
The account goes to Mr. Y, not Mr. X.

Why? The account arrangement is contractual. The beneficiary designation operates through that contract rather than through the instructions in your will.

The practical lesson is simple: do not assume that changing your will changes the beneficiary on your bank account. Your account designations and your will need to reflect the same intentions.

India: A Bank Nominee Is Not Necessarily the Ultimate Inheritor

For the Indian bank accounts we are discussing, the distinction is different. Naming a nominee helps the bank release the money, but it does not necessarily determine who is ultimately entitled to inherit it.

Suppose you name your elder son as the nominee on your NRE or NRO account. You then make a will leaving that same account to your younger son.

In that example, the younger son is entitled to the money under the will. The elder son, as nominee, receives or holds it for the person entitled to inherit. He does not become the ultimate owner simply because the nomination names him.

Receiving money from the bank and inheriting that money are two different things. That is the distinction Indian American families need to understand when coordinating estate planning in India and Texas.

When Nominations May Be Enough in Practice

Now, the legal position is one thing. The practical question is another.

Suppose your only property in India consists of one or two bank accounts. You have named your elder son as nominee, and you also intend for him to receive the money. A nomination can give the bank a straightforward way to release those funds.

The same practical reasoning applies when nominations reflect an intended division between your children, such as an equal split, subject to the bank’s applicable nomination arrangements.

For an older person with adult children and only a few Indian bank accounts, I would not automatically recommend a separate Indian will just because those accounts exist. Proper nominations may suffice for that limited purpose.

But that does not mean a nomination replaces inheritance law. It means that, in a simple situation, it may address the immediate practical issue of getting the money released. Avoid creating conflicting instructions that leave your family uncertain about who should receive what.

Minor Children Change the Answer

The strongest reason I recommend an Indian will may have very little to do with your account balances.

Consider a family living in Texas with minor children. Both parents want the children to move to India and live with grandparents, a brother, or a sister if neither parent survives.

You may have people in Texas who can step in immediately, collect the children, and care for them temporarily. But those people may not be your intended long-term guardians.

In that situation, I recommend planning for both parts:

Care in Texas:
Name your intended guardians through the appropriate Texas documents, such as your will or a guardianship declaration.
Long-term care in India:
Have a separate Indian will naming your intended guardians there.

I would strongly suggest this even if you have very few assets in India.

Why Not Rely Only on the Texas Documents?

A Texas guardianship declaration is prepared under the Texas Estates Code. If an Indian court later needs to consider your children’s guardianship, relying entirely on Texas documents can create difficulties because those documents were prepared for a different legal system.

An Indian will lets you state your wishes about guardians in a document prepared for use in India. The purpose is to make your intentions clearer where your family expects the children’s long-term care to take place.

The question is not just, “Who gets my NRE account?” It is also, “Who will raise my children?”

Do Not Leave Indian Accounts Without Nominations

If you keep your Indian bank accounts, at least make sure you have nominations in place.

Without them, your family may have to apply for a succession certificate under the Indian Succession Act to access the funds. That can involve court proceedings, hiring a lawyer, and significant expense.

In my experience in Hyderabad, Telangana, the court fee for such a proceeding can be steep, around 6% of the relevant amount. Treat that as a location-specific example, not a uniform fee across India, and confirm the applicable requirements and charges.

For older families keeping only a small number of accounts, I also ask a practical question: why keep the money in India? If there is no continuing reason, consider whether moving it to the United States would simplify matters for your family. If you do need to keep the accounts open, do not neglect the nominations.

The Bottom Line for Indian American Families

Only a few Indian bank accounts, with adult children:
Clear nominations may be enough from a practical standpoint for those accounts.
Minor children who should live with family in India:
I strongly recommend an Indian will naming intended guardians, alongside your Texas guardianship planning.
Accounts without nominations:
Your family may face a more difficult and expensive process to obtain the funds.
A will and nominations naming different people:
Understand the difference between the Texas and Indian rules, and resolve unintended conflicts.