Anita

Hi all, My fiance and I are planning on buying a house soon. His and my parents will
be helping us with our downpayment and probably I will sell some property that I own
in my country. My fiance and I are from different countries but we are both on H1-B.
Will we have to pay gift tax on the amount that we get from his parents ? What about
rental income that I get from my property back in my country ? Do I need to pay tax
on that? I already pay taxes in my country on that property! Thanks Anita

Ingo Pakleppa

On 15 Apr 2002 21:11:34 -0700, [email protected] (anita) wrote:

    >Hi all, My fiance and I are planning on buying a house soon. His and my parents will
    >be helping us with our downpayment and probably I will sell some property that I own
    >in my country. My fiance and I are from different countries but we are both on H1-B.
    >Will we have to pay gift tax on the amount that we get from his parents ? What about
    >rental income that I get from my property back in my country ? Do I need to pay tax
    >on that? I already pay taxes in my country on that property! Thanks Anita

Your questions are very tricky tax questions, and I'd advise you to ask a qualified
tax professional, or at the very least go to the IRS Web site and read the various
publications there. But here is my unqualified stab at it:

- you probably will have to pay gift tax as long as the gift exceeds a certain
amount. I think that limit may be pretty high given that it's a gift within the
family (although special rules may apply if the giver is not a US tax resident).

- as long as you are a US tax resident (almost all H-1Bs are, with the possible
exception of the first year), you will have to pay taxes on your worldwide income.
That includes the rental income from your foreign property.

- you may or may not be able to claim a tax credit for the foreign taxes you paid on
your foreign income. It depends on whether or not there is a treaty between the US
and your country. To make matters even more complicated, some states do not
recognize such treaties, so for instance you may still have to pay California
income tax on this already-taxed income.

Ingo

I am not a lawyer and this is not legal advice. For reliable advice, please consult
with a professional immigration attorney.

For further information, check the following frequently-requested links.

For many questions, you may find answers at
http://travel.state.gov/visa_services.html (Department of State)

or http://ins.usdoj.gov (INS).

For consular policies and visa reciprocity fees, find your consulate in
http://travel.state.gov/links.html

For visa denial and suggestions what to do about them, see
http://travel.state.gov/visadenials.html

For DOL Online Labor Certification: http://workforcesecurity.doleta.gov/

For information on affidavit of support for marriage to US citizens (I-864), go to
http://travel.state.gov/i864gen.html and http://travel.state.gov/checklist.html

For information on entering the US as a K-1: http://www.k1poelist.com/

For poverty levels, see http://aspe.os.dhhs.gov/poverty/00poverty.htm

For information on H/L/O/P visa extensions at Dept. of State in St. Louis, MO, see
http://travel.state.gov/revals.html

For non-official information, check:

(When using these sites, and any Web sites, please watch out for privacy, as I do not
know all site operators.)

http://www.visalaw.com http://www.shusterman.com http://www.immigration.com
http://members.aol.com/MDUdall http://www.murthy.com/ http://www.richw.org/dualcit/
(dual citizenship FAQ) http://www.ilw.com http://www.srs-usvisa.com
http://www.getusavisa.com http://greencard-lottery.virtualave.net/
http://www.jcvisa.com (H-1B) http://www.h1bresources.com (marriage and fiancee)
http://www.kamya.com/misc/ (marriage and fiancee)
http://www.mindspring.com/~docsteen/...o/visainfo.htm http://www.workpermit.com

This is not an endorsement of any of these Web sites. I am not affiliated with any of
the Web site owners and do not receive nor accept payment in return for listing them,
and typically don't even know them.

(if believe you have a good immigration-related Web site and want your Web site
listed here, please e-mail me).

Stuart Gill

In article <[email protected]>, Ingo Pakleppa
<[email protected]> wrote:

    > On 15 Apr 2002 21:11:34 -0700, [email protected] (anita) wrote:
    >
    > >Hi all, My fiance and I are planning on buying a house soon. His and my parents
    > >will be helping us with our downpayment and probably I will sell some property
    > >that I own in my country. My fiance and I are from different countries but we are
    > >both on H1-B. Will we have to pay gift tax on the amount that we get from his
    > >parents ? What about rental income that I get from my property back in my country
    > >? Do I need to pay tax on that? I already pay taxes in my country on that
    > >property! Thanks Anita
    >
<snip>
    > - you probably will have to pay gift tax as long as the gift exceeds a certain
    > amount. I think that limit may be pretty high given that it's a gift within the
    > family (although special rules may apply if the giver is not a US tax resident).

Gift tax is NOT paid by the receiver of the gift but the giver so if the giver of
your gift is not a US tax resident there will be no US tax obligations. If they are a
US tax resident then there may be US tax obligations depending on the size of the
gift but those taxes would be borne by the giver.

If you are going to use the gift for part of the downpayment on the house then you
might want to try to have the money sitting in your US account for at least two
statements after the transfer/desposit. This is because loan providers will want to
see those statements (most recent two) and will question any large deposits. Some
programs (though not all) will want some of your own cash in there beyond the gift.

Good luck with the house hunting, Stuart

J & P

Home purchase, taxes and immigration status are completely seperate issues, as far as
the US government is concerned.

If there is any tax liability in this transaction, which we doubt, one may avaoid it
by entering the gift givers as co-owners of the house (joint tenancy).

anita wrote:

    > Hi all, My fiance and I are planning on buying a house soon. His and my parents
    > will be helping us with our downpayment and probably I will sell some property
    > that I own in my country. My fiance and I are from different countries but we are
    > both on H1-B. Will we have to pay gift tax on the amount that we get from his
    > parents ? What about rental income that I get from my property back in my country
    > ? Do I need to pay tax on that? I already pay taxes in my country on that
    > property! Thanks Anita