Nimco

If I move my family to the US on a sponsored visa, does anyone know if there are any complications to be aware of with regard to moving money into the US to purchase a house?

And later, if the H1B ends or we decide to move the family back, is there any issue with moving the proceeds of the house sale back to the UK?

Is there CGT (equivalent) in the US attributed to your main residence when selling if you are a foreigner on a H1B?

Thanks for any help here. This stuff is so complex!

ian-mstm

I don't believe there's a limit on the amount of money you can transfer. If the amount is over US$10,000, the financial institution is obligated to report the amount to the Department of the Treasury (for RICO purposes)... but it's a reporting obligation only... not a tax burden for you.


Yes - you will be liable for US tax with respect to any capital gain on the sale.

Ian

rpjs

But for sale of your primary residence there's a $250k exemption per person which you and your spouse can combine if you file as married filing jointly (so $500k in total)

You should also check for any FBAR (Foreign Bank Account Report) requirement if the proceeds from your house sale take your total UK bank account balances over US $10k whilst liable for US taxes - e.g. if you have the proceeds in your UK account when you take up residency in the US or they pass through your UK account prior to sending them to the US if you complete the sale after you move. Again, these are reporting requirements.

Nimco

Is this exemption allowable against the profit?

Nimco

And thank you both for this help!

Cape Blue

Rent - you'd be nuts to buy when only on an H1B.

rpjs

Yes, the Capital Gain is the profit and you can also deduct selling costs too.

TimNiceBut

This.

You're tied to an employer, if the employer lets you go or goes under, you have to find another employer to take over the H1B sponsorship within a couple of weeks (IIRC), otherwise you'll find yourself on the way back home with no ifs or buts. Owning a house doesn't change any of that, all it means is that you'll end up having to pay the mortgage on a house that you can't live in. Unless you pay cash for the house, in that case you'll "just" end up paying property taxes and insurance on something that you *might* be able to rent out.

If you do need a mortgage, there's a big question if you can even get one - most banks here tend to not extend credit past your H1B expiry date, although I'm not sure if that's the same with mortgages. Plus, you don't have a US credit history in the first place and you'll need to establish one before someone will lend to you unless we're talking punitive rates here.

Bob

This.

Not only for the points made in the post above...it just costs a hell of a lot more to sell a place in the US compared to the UK, 6%...so just not worth it for a few years if things don't work out, not to mention you not knowing the area well, nor the potential life style issues of the area.

TimNiceBut

There might also be some sort of transfer/sales tax to pay on the sale of a house, so 6% might not include all the costs. Plus there is a chance that repairs are necessary (IIRC the previous owners of the place we just bought ended up having to pay a few grands' worth of repairs on a well maintained house).