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Money from sale of UK house

Money from sale of UK house

Old Jan 26th 2018, 3:36 am
  #1  
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Default 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.
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Old Jan 26th 2018, 3:08 pm
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Default 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?
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Old Jan 26th 2018, 3:24 pm
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Default 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.
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Old Jan 29th 2018, 1:45 pm
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Default Re: Money from sale of UK house

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