I have a client whose brother is a Swiss citizen. He bought a ranch 7 years ago for 2 million and now has an offer to sell for 3 million. Due to the decline of the Swiss Franc he will lose money. Once converted. I have not found any way for him to lesson his US capital gain. Does anyone know of a way beside using closing cost.
Announcement
Collapse
No announcement yet.
Sale of property by foreign owner
Collapse
X
-
Selling real property in the U.S. results in U.S. source realized gain/loss. (gain in this case). Of course it is subject to U.S. tax.
If the Swiss franc has gone down in value compared to USD, then that would be more economic gain, not less.
No, there is no way to reduce his capital gain if he sold real property. Proceeds less expense of sale less adjusted basis equals net taxable gain."You said it, they'll never know the difference. Come on, we'll paint our way out!" - Moe Howard
Comment
-
You never said property was located in US. I believe the capital gain on sale of real estate for nonresident alien's is considered "effectively connected income", and may have deduction's and credits available. I am not experienced in that area, so you should research it, or maybe someone will commit.
Comment
-
Originally posted by terryats View PostYou never said property was located in US.
The OP did say this: "she [his tax client] also takes care of the property in the summer as well as being the realtor who will be selling the property for him."
See Pub 519 for a discussion of effectively connected income.
Last edited by Rapid Robert; Today, 11:09 AM."You said it, they'll never know the difference. Come on, we'll paint our way out!" - Moe Howard
Comment
Disclaimer
Collapse
This message board allows participants to freely exchange ideas and opinions on areas concerning taxes. The comments posted are the opinions of participants and not that of Tax Materials, Inc. We make no claim as to the accuracy of the information and will not be held liable for any damages caused by using such information. Tax Materials, Inc. reserves the right to delete or modify inappropriate postings.
Comment