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mcnam · Nov 20, 2011, 05:16 PM

I'm a retired US citizen. My family just sold some (vacant) overseas property in which I was part owner. What do I need to do if I want to transfer my share to my account in the US? Do I have to pay US taxes on the sale?

Gryphyn34 · Nov 28, 2011, 01:51 PM

I don't think you will need to pay taxes on the sale but you may have to pay taxes on them as income at the end of the year. I'm not 100 percent on this. Contact the IRS and they will be able to tell you.

mcnam · Nov 29, 2011, 05:28 PM

Thanks but that wasn't really very helpful. Perhaps you need more information?

My parents are US citizens who have lived overseas for the last 40 years. About 15 years ago, my father closed his overseas factory and has left it "rotting". He was recently approached by a buyer, has decided to sell, and wants to split the proceeds 5 ways (between himself, my mother, and his 3 kids - we're all US citizens) My siblings and I live in the US. I am retired, they are still working. Dad has not received all the payment installments yet, but is planning on transferring the money to an account in the US when he completes the sale (prior to April 1, 2012). We are concerned about the tax liabilities (especially to my siblings who are in higher tax brackets), and I am trying to find out how he can do this (give us each our share, bring money to US) without incurring any tax liability (either to himself or to us).

ebaines · Nov 30, 2011, 10:51 AM

In your first post you said you were a part-owner of the property, but in your second post you imply that your father is the sole owner and he wants to make a cash gift to you after he sells the property. Depending on which scenario is correct you have different tax consequences:

1. If your father is the sole owner then when he sells and makes a cash gift to you there are no tax consequences for you at all, because gifts are not taxable and there is no tax on transferring money from foreign countries into the US. Of course your father may have tax consequences in the country where he resides and/or where the property is located.

2. If you are actually a part-owner of the property when it sells then you must report your share of the proceeds and your cost basis, and calculate a capital gain based on that. If you have a profit from the sale you would pay US income tax at most likely a 15% tax rate. You would also have to report the sale to the tax authorities in the country where the property is located, and would most likely have some tax consequences from that, but the good news is you can take a credit on your US taxes for foreign taxes you've paid.

Hope this helps.