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Old 10-21-2015, 03:47 PM
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Tax for selling property outside US

Hello all,
I have been staying in USA for one year under L1 working visa.
If I were to sell my property outside of USA, do I have to pay tax in USA?
I heard that it is not taxable if I have yet to stay in USA for 2 year time.
Thank you.



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Old 10-22-2015, 12:42 AM
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Quote:
Originally Posted by yolz View Post
Hello all,



#1;I have been staying in USA for one year under L1 working visa.
If I were to sell my property outside of USA, do I have to pay tax in USA?



#2I heard that it is not taxable if I have yet to stay in USA for 2 year time.
Thank you.
________________________________________
Hello all,
#1;Yes as you are a US resident for tax purposes; If you are treated as a US resident for tax purposes, then yes; however you can claim capital gain tax that you pay in your home country on your US return by claiming it on form 1116 or on 1040 line 48 or on SCh A line 8.



#2;It depends, assaid if you are a US resident for tax purposes, then yes . If you are not treated as a US resident for tax purposes but are a nonresident alien then no. HOWEVER, aslongas you are a US resident for tax purposes, then, you can exclude up to $250K as a single filer in profit from the sale of a primary home (or $500K for a married couple) as long as you have owned the home overseas and lived in the home for a minimum of 2years. Those2 years do not need to be consecutive. In the 5 years prior to the sale of the house, you need to have lived in the house for at least 24 months in that 5-year period. In other words, the home overseas must have been your principal residence.
You can use this 2-out-of-5 year rule to exclude your profits each time you sell or exchange your main home if you buy a new primary home in US as a US resident for tax puirposes.



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