US foreclosures - Boholt Seminars - NO

[Chui]

I had not even considered inheritance tax BTW Chui. That has got my attention. In ten years I have never had a legal issue with a US tenant. Not to say it won't happen, but it hasn't yet.

I read a bit more today, and I must say I don't like what I see. http://www.firpta.com/what-is-firpta Nobody knows when they are going to drop dead, and investing overseas can be so risky in this manner. The threshold is only circa $60k for foreigners.

The person blogging here is very knowledgable. http://www.firpta.com/

http://www.firpta.com/0205-using-trusts-to-prevent-estate-tax-on-us-real-estate

Doing it right

It has to be an irrevocable trust. The person contributing the money to the trust can’t control the trust, directly or indirectly. Nor can the person contributing the money enjoy the benefits of the trust. (These are called “retained interests” in tax jargon).

The trust can be set up as a foreign trust or a U.S. domestic trust.

The typical situation for this strategy is where nonresident parents wants to provide a house in the U.S. for their child. It works best when the parents have no desire to eventually reclaim the money–they see the structure as an outright gift.

There's more about rental election. http://www.firpta.com/essential-tax-election-for-real-estate-investors. Unlike Australia, you are taxed at 30% of gross rental not net profit unless you elect to (no brainer!). The language, backed up here for posterity.

ample language

Here is a sample you can follow. Just attach this on a statement attached to the Federal income tax return filed (Form 1040-NR or Form 1120-F).

(Taxpayer Name)
(Taxpayer Identification Number)
Attachment to Form (1040-NR or 1120-F)
Tax Year Ending December 31, 2008
This statement constitutes an election under Regs. §1.871-10(d)(1)(ii) to treat the income generated from the following properties in the United States owned by the taxpayer as income effectively connected with a U.S. business for taxable year ending December 31, 20__ and thereafter:

Property 1 -
Land and Improvements located at 123 Easy Street, Anytown, USA. The structure is a commercial office building. Taxpayer holds a fee interest in the land and all property improvements located thereon. No prior election has been made under Regs. §1.871-10(d)(1)(ii) with respect to the subject property.

 

[Aaron Sice]

I read a bit more today, and I must say I don't like what I see. http://www.firpta.com/what-is-firpta Nobody knows when they are going to drop dead, and investing overseas can be so risky in this manner. The threshold is only circa $60k for foreigners.

The person blogging here is very knowledgable. http://www.firpta.com/

http://www.firpta.com/0205-using-trusts-to-prevent-estate-tax-on-us-real-estate



There's more about rental election. http://www.firpta.com/essential-tax-election-for-real-estate-investors. Unlike Australia, you are taxed at 30% of gross rental not net profit unless you elect to (no brainer!). The language, backed up here for posterity.

sorry - 15% is such a negligible amount of tax why would you put yourself before the IRS chopping block to avoid paying it?

you could end up in gaol there pretty damn quick if you got it wrong.

 

[lawsjs]

[/I02 – Estate tax and the nonresident investor

The estate tax is a tax imposed on a deceased person’s wealth. It is as high as 45% of the value of property owned by that person. Avoiding this tax is perhaps the highest priority for a nonresident investor.

??15%??
Chui is right - scary stuff... Tell me this is wrong?

 

[Emma171]

Jeremy, Chui, you are not wrong... Why I am going for US Citizenship! Yes I know, the easy way out but inheritance is a personal issue for me. Have been non communicado today but inheritance was scared into me as well.

 

[Emma171]

Not sure on needing to dispel rumors but feel free to google me... "Emma Wilson"in the States. Fascinating read, picking up tons of info from everyone a massive missing link for me.

 

[Aaron Sice]

[/I02 – Estate tax and the nonresident investor

The estate tax is a tax imposed on a deceased person’s wealth. It is as high as 45% of the value of property owned by that person. Avoiding this tax is perhaps the highest priority for a nonresident investor.

??15%??
Chui is right - scary stuff... Tell me this is wrong?

sorry - i read the post wrong.

sorry - but if i was on my deathbed, i'd liquidate the lot.

 

[lawsjs]

Aaron,
DOH!

 

[Aaron Sice]

reading FIRPTA seemed like how to avoid paying tax as a foreigner .... period.

 

[lawsjs]

Emma,
I read on propertyinvesting.com about someone having dramas with Notaries. They think they have solved the issue (I cant remember my login details to correct/help them) but they are about to enter a world of problems...

I have been caught out on this a number of times. Regardless of the fact an Australian Notary is appointed for life by the Archbishop of Canterbury and must have been practicing law with a blemish free record for 25 years (hard given our barristers and their current issues with tax law the 'non southern' (from the civil war) states all automatically accept Commonwealth notaries, but the idiots that program the computers that work in the State titles offices will not accept anything less than a US notary. More often than not these idiots are not capable of tying their shoelaces, but the only way 'we' can get an 'acceptable' US Notary is to book an appointment at the Embassy (ONLY Syd and Mel - used to be Syd only) queue up for hours and then be frisked by a guy that looks like a terrorist (I don't mind when the security girls do it in BKK, but anywhere else in the world is just not the same) pay US$275 and listen to some 17yo american read a passage from something and present a bible.

Apparently it is easier to be a Notary in the US than to find a good crack dealer, and I am not insinuating anything here Emma, but would you be able to become a Notary? I for one would be happy to pay a premium for a 'sensible' Notary. Ive been told it is not an arduous process...

A US Notary needs to be a US citizen/resident (even though the last I met could NOT speak English - OR American) - would you be able to do everyone here favour and be one? I would be happy to reimburse you any costs involved in doing a course or whatever they call it. My current pending sale has been held up 2 MONTHS because of my inability to get a bloody US Notary appointment!



PS: Aaron, you mis-spelt reduce. You spelt it a.v.o.i.d. I'm sure you didn't mean to spell it quite like that.

 

[D.T.]

On that topic Jeremy, if needed, you can have Australian documents signed in Sydney by the Apostile, making them (almost) worldwide acceptable. Goto http://www.apostille.com.au/hague-convention.php for more info.

 

[lawsjs]

Australian Notaries are by default _members_ of the Apostille.

It doesn't work. I spent $1000 in the last 2 weeks trying to prove that what you say is correct (and it is) but it just doesn't cut any ice in the US.

 

[Chui]

I'm sorry, why and when is a notary required?

 

[lawsjs]

You need a notary like you need a JP in Aus.

bulldust, but you need one.

 

[lawsjs]

Sent: Tuesday, October 26, 2010 4:29 PM
To: Wyland, Cheryl (TRG)
Cc: Ascensio, Rosie (TRG)
Subject: RE: Message from 42BW-2

The notary from the Australian notary is no good without an apostille from the American Consulate.

Or have it acknowledged at the American Consulate.

Danielle

 

[Chui]

You need a notary like you need a JP in Aus.

For certifying documents?

Would I need it when
x Buying?
x Selling ?
x Borrowing ?
x Renting ?

 

[lawsjs]

Chui,
Your grasp of the situation is exceptional You don't need one when renting - otherwise, brilliant deduction!

These are the 'little' things that just make dealing with the US hard...

I am lucky, I couldn't get an appointment at the SYD consulate until late Dec '10. I will be in LA on Sunday/Monday this week, so my drama's are over then - I am simply paying extra for a US Notary to 'witness' a signature on a sales form out of hours.

Every time I go through this drama I forget what a pain it was last time. A nonsensical waste of time, and they are not even correct in what they say is correct. But US reg;s are non waivable and designed for fools and idiots.

Pain in the proverbial... Never thought of Emma - she may not like me all the time, but I'm certain she knows who I am...

 

[lawsjs]

If Emma can become a notary, then I think she may be able to provide this service for not just me but a number of people.

As an Australian citizen I would assume she must recognise a JP's signature. As a US notary (and I think Nv is a state that recognises au notaries - it seems only the really 'redneck' states Al.Ak.etc don't) she should be aware of the law - which recognises, if not JP's then certainly Au notaries, I think then it should be possible for her to overcome this (hidden) nightmare for the rest of us...

 

[Emma171]

Yolanda is a notary. You need notaries for your NRS 113 Waiver primarily for foreclosed properties... Ie your waiver of inspections etc. For every offer there is a 13 page offer form and generally one does require a notary. I have a dude in Manly that does charge $190 but is quick when needed.

 

[bernie006@hotma]

--------------------------------------------------------------------------------

dear unknown,
im german,live in melbourne.
i dont know where to start to invest from australia in the usa.
i lived there,been there many times etc but never invested.
how ll i do it?invest through a llc,set bank account up in usa or only have rent transfered to aus,do u know any good management company.what tax implications will i have?

pls contact me here or email [email protected]

i want to thank you in advance and hope to hear from you soon

bernie

 

[lawsjs]

But (certainly in Ca) it has to be witnessed by a US notary.

Manly guy just not good enough... This a serious issue Emma, the LA, LB, OC titles offices just will not accept anything less than a 'US notary'. And they 'have' to actually witness you sign the bloody form IN THE US.

I usually just wait till I'm in LA to solve this problem, but when I have had to front up to the Guantanamo like MLC centre for this garbage I am usually in the queue with other equally pissed off people....