Buying Real Estate In USA As A Foreigner

Do you live outside of the United States and thought about buying property in the USA? You can and we will explain the process and some tax issues to look out for.

Buying Real Estate as a Foreigner

If you’re buying property simply as an investment and that investment generated income, you will be subject to taxes in the United States at the state and federal level. In addition to this there will be United States tax liabilities that will arise when you dispose of the property and estate tax liabilities when you expire. Disposition tax and estate tax will affect both income producing property and property held as a residence.

The Liability Factor

In terms of how much you are going to be liable to pay to the United States will depend on where you are located outside of the country. Some countries have treaties with the United States and this can affect your liability. The minimum withholding is set at thirty percent of income that leaves the United States. There are ways to lower this, one of them being holding the property within a business structure.

Tax Credits Are Available

Depending on the country that you reside you may be able to take a tax credit for the tax paid to the United States for the property you hold. It is also very important that you understand the laws of your country in terms of holding property within a business structure. Some countries will penalize you more for one form of business over another. This can greatly affect the amount of income you ultimately get to keep after it is all said and done.

About Paul Gaulkin CPA

Paul Gaulkin is a Certified Public Accountant and enrolled with the U.S. Treasury to practice before the IRS. Mr. Gaulkin possesses unique technical knowledge in the process of securing relief for taxpayers nationwide with IRS and State tax problems. With an accounting degree from Florida International University, he is able to transform complex tax and accounting problems into easy to understand solutions.


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