Income Tax
May 19th 2015, 6:47 pm
#1
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Thread Starter
Joined: Jan 2014
Posts: 28
Income Tax
I have just moved to the US on a spouse visa with a green card.
I have a property in the UK which is rented. I am planning on remortgaging it in the UK and transferring the money to the States. will this money bring up any tax liabilities in the USA? Our plan is to by a house in the US.
Thanks
I have a property in the UK which is rented. I am planning on remortgaging it in the UK and transferring the money to the States. will this money bring up any tax liabilities in the USA? Our plan is to by a house in the US.
Thanks
May 19th 2015, 7:12 pm
#2
Lost in BE Cyberspace
Joined: Mar 2010
Location: Phoenix, AZ
Posts: 8,106
Re: Income Tax
Your biggest problem might be finding a UK bank willing to remortgage to you while you are in the US.
May 19th 2015, 7:34 pm
#5
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Joined: Jan 2014
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Re: Income Tax
My financial adviser found it for me. I will be seeing him tomorrow and will get the information for you.
I'm still not sure if I will get it as I do not want an unexpected tax bill.
May 19th 2015, 9:16 pm
#6
Joined: Dec 2001
Location: Dixie, ex UK
Posts: 52,463
Re: Income Tax
Refinancing won't per se create a taxable event. .... Paying off your mortgage (the old one) might create a taxable FX gain if from a USD perspective it costs fewer dollars to pay off than you received when you took out the mortgage (adjusted for repayments of principal). With the benefit of hindsight you should have refianced whilst still in the UK. It has been debated on BE several times as to whether the gain would be noticed and taxed by the IRS, but per the IRS guidance a FX gain on the repayment of a loan certainly seems to be taxable.
That said, unless you are certain you are returning to the UK before you need to sell the house, you should seriously consider selling it because you are setting yourself up for the twin nighmares of managing a rental property from across the Atlantic and dealing with a potentially substantial capital gains tax bill from Uncle Sam if you sell it more than three years after you moved out, and now a CGT bill from HMC&R if you sell it more than 18 months after you move out.
That said, unless you are certain you are returning to the UK before you need to sell the house, you should seriously consider selling it because you are setting yourself up for the twin nighmares of managing a rental property from across the Atlantic and dealing with a potentially substantial capital gains tax bill from Uncle Sam if you sell it more than three years after you moved out, and now a CGT bill from HMC&R if you sell it more than 18 months after you move out.
Last edited by Pulaski; May 19th 2015 at 9:18 pm.
Jun 4th 2015, 10:20 am
#7
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Joined: Jan 2014
Posts: 28
Re: Income Tax
Hi, Sorry for the delay. The mortgage didn't work out, you're right it is very difficult. My financial adviser thought he could get on, alas it's a no go.
