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    johnnyrodd's Avatar
    johnnyrodd Posts: 3, Reputation: 1
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    #1

    May 28, 2013, 07:23 AM
    tax credit for inheritance tax paid overseas
    my wife's mother died in Brazil and my wife inherited the apt her mother lived in.
    my have has to pay inheritance tax in Brazil for the market value of the apt, ($50k)
    what we want to know is can she sell the apt. there and use the funds to buy a house here in New Jersey without any U.S. tax liability. The amt she will get after selling the apt will be about $300k.
    johnnyrodd's Avatar
    johnnyrodd Posts: 3, Reputation: 1
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    #2

    May 28, 2013, 07:27 AM
    My wife inherited her mothers condo in rio de janeiro brazil. If she sells it she can net 300k after paying 50k inheritance tax in Rio. Can she bring that money here to buy a home witout any tax liability here in the U.S and can she get a tax credit for the 50k she has to pay there over here. My wife is a U.S citizen , her mother did not live here and was not a u.s citizen
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #3

    May 28, 2013, 07:28 AM
    Her tax liability in the US is limited to any capital gains that she may realize on the difference between the proceeds she realizes from the sale and the fair market value of the property as of the date of death of her mother. Most likely the amount of capital gain is close to zero, and could even be negative if there are costs such as realtor's fees. If capital gains are zero or negative then essentially there are no tax implications in the US.
    tickle's Avatar
    tickle Posts: 23,796, Reputation: 2674
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    #4

    May 28, 2013, 07:39 AM
    The Brazilian real is only worth .49 cents on the US dollar so 50m reals converted to US is only 25m approx. where do you figure 300m US?
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #5

    May 28, 2013, 07:47 AM
    Ebaines covers it well.
    johnnyrodd's Avatar
    johnnyrodd Posts: 3, Reputation: 1
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    #6

    May 28, 2013, 07:58 AM
    The apt is worth 1 million reals so her tax was 10 pct which is 50 k reals
    The apt is in bad shape so the most she will get if she sells ii is about 650k reals roughly 300k usd
    tickle's Avatar
    tickle Posts: 23,796, Reputation: 2674
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    #7

    May 28, 2013, 09:43 AM
    Quote Originally Posted by johnnyrodd View Post
    the apt is worth 1 million reals so her tax was 10 pct which is 50 k reals
    the apt is in bad shape so the most she will get if she sells ii is about 650k reals roughly 300k usd
    Ah, yes, I see, I thought you meant it was worth 50 thou.
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