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    ljara's Avatar
    ljara Posts: 1, Reputation: 1
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    #1

    Jan 11, 2009, 08:36 AM
    Taxing income from foreing real state sell
    I'm a US citizen since 2004. My husband and I file for taxes jointly. I'm originally from Paraguay (South America). I had bought a piece of land (with the help of my family) in Paraguay when I was still single. I sold the piece of land in Nov.2008. How do I report it? Could I treat this as a family gift? Thanks.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #2

    Jan 13, 2009, 12:41 PM
    If the land was in YOUR name, then the profit from the sale is YOUR capital gain, which must be reported on Schedule D.

    At most, you will pay 15% (and may pay as little as 5%) on the PROFIT realized from the sale.

    Strongly recommend that you get professional tax help.
    IntlTax's Avatar
    IntlTax Posts: 831, Reputation: 23
    Tax Expert
    		  
    #3

    Jan 14, 2009, 05:32 AM

    You will need to calculate your cost of the property using the Paraguay currency to U.S. dollar exchange rate on the date you purchased the property. Unfortunately, this may mean that you cost basis in the property is low.

    In addition to the 15% federal tax referred to by ATE, you may owe state income taxes.
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