Money from sale of UK house
 

Hi, we sold our UK house in Mar17, with the profit we made still sitting in our UK bank account. My wife and kids (all USC's) flew into the US in Jun17, and I arrived in Oct17 on an IR-1 visa. We need to know if we may be liable for US tax on the house profit... someone had advised us that we have a year from the sale date to reinvest the profit in a main home in the US, or else expect to pay tax on it. Does anyone know if this is true? We do intend to buy a house over here at some point in the future, but it will take time to build our credit score to qualify for a mortgage.
Thanks

Re: Money from sale of UK house
 

Who is "we"? Did the USC spouse own any share of the property? If so was there a mortgage?

Re: Money from sale of UK house
 

If, as at the date of sale, you lived in the house for "two of the past five years" (24 of the past 60 months) AND the gain was less than $250,000 then no tax will be payable. If you file taxes jointly with your wife then that number is doubled.

There may be a gain (probably is, given the fall of sterling over the past three years) on repayment of the mortgage, and that could have capital gains tax implications.

The "12 months to reinvest in another property" is an option for businesses and does not apply to sales of non-investment property, and therefore isn't applicable to your situation. There is also a significant burden on the way such a transaction must be executed and documented.

Re: Money from sale of UK house
 

Thank you so much for the replies, this has really helped.