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Itemized Deductions Schedule-A


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Old 02-02-2014, 04:36 PM
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Exclamation paid transfer tax deduction on property bought in Spain

Hello,
In 2013 I divorced, cashed out a retirement fund received from the settlement and bought, paying cash an apartment in Spain. I own no other property in the US and only now prepare my move.
1.) Can I deduct the 8% transfer tax paid in Spain for the purchase of the property and any other expenses (lawyer fees...etc)? (some $12k)
2.) Starting with 2014 my sole income will be based on $30k/year alimony. Do I have to pay taxes on it? Should I pay US taxes or in Spain?

Thank you!



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Old 02-02-2014, 06:13 PM
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Join Date: Oct 2010
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Quote:
Originally Posted by Estepona View Post
.
1.) Can I deduct the 8% transfer tax paid in Spain for the purchase of the property and any other expenses (lawyer fees...etc)? (some $12k)


2.) Starting with 2014 my sole income will be based on $30k/year alimony.



3.)Do I have to pay taxes on it? Should I pay US taxes or in Spain?

Thank you!
1.)I assume that you are a US resdinet.Aslongas it is your primary home, then you need to itemize deduction son Sch A on US return.
UNLESS you itemize deductions, no you can’t claim them on your US return.

2.)Yes; you need to report it on 1040 ; Alimony is taxable income for the recipient and is a tax deduction for the payer. The recipient reports alimony received on Form 1040 Line 11.


3.) UNLESS you are a US resident for tax purposes, yu do not need to pay tax in US; aslongas you are a US resident even for tax purposes, then you are subject ttoi US taxes on your US source and world wide income(any income that you earned in Spain) to IRS/your state.



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