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When does your UK property stop being your residence

When does your UK property stop being your residence

Old Apr 6th 2014, 1:10 pm
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Default When does your UK property stop being your residence

Hi there,
I am trying to calculate for tax reasons when our UK house would have stopped being our residence. I moved over before the family and then the family went back and forth a bit between US and UK.
We then started renting our house out which I would assume is the date we cannot say it was our family residence anymore.
Reason I'm asking is we are close to having to pay US tax on any profits if we sell.
Thanks
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Old Apr 6th 2014, 7:12 pm
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Default Re: When does your UK property stop being your residence

I think more information is need. Did you come over on an immigrant visa, if so I would suggest the time starts from when all the family first arrived in the US?

If not an immigrant visa, when going back and forth did you spend more time in the UK or US. Which was your main residence?
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Old Apr 6th 2014, 9:44 pm
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Default Re: When does your UK property stop being your residence

Originally Posted by moving2nyc View Post
Hi there,
I am trying to calculate for tax reasons when our UK house would have stopped being our residence. I moved over before the family and then the family went back and forth a bit between US and UK.
We then started renting our house out which I would assume is the date we cannot say it was our family residence anymore.
Reason I'm asking is we are close to having to pay US tax on any profits if we sell.
Thanks
I would say the day you entered the US to live using your visa. We kept our house in the UK for a few years after moving here...going back several times a year...but the day we moved here it was no longer our primary residence.
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Old Apr 6th 2014, 10:21 pm
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Default Re: When does your UK property stop being your residence

Another question.

Precisely who owns the house -are you the sole owner or do you own it jointly with your spouse?

If there is more than one owner then the date on which the property ceased to be the principal residence could be different for each owner.
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Old Apr 6th 2014, 10:25 pm
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Default Re: When does your UK property stop being your residence

I don't think anyone can give you a definite answer including a CPA. The only safe answer is to assume that it the day you entered the US because everything else could possibly be questioned by the IRS.

However I suspect a CPA could say it is possible that when there are two residences and at least one of the married couples considers one of the residence as primary, you could possibly use the date of when she last moved out but then you may possibly be audited by the IRS.
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Old Apr 6th 2014, 10:34 pm
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Default Re: When does your UK property stop being your residence

It's worth noting that since this could just as easily arise from a domestic U.S. relocation, it may not be all that unusual. And if you search within the IRS guidance, an answer may already be there.
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Old Apr 6th 2014, 11:13 pm
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Default Re: When does your UK property stop being your residence

Originally Posted by moving2nyc View Post
Hi there,
I am trying to calculate for tax reasons when our UK house would have stopped being our residence. I moved over before the family and then the family went back and forth a bit between US and UK.
We then started renting our house out which I would assume is the date we cannot say it was our family residence anymore.
Reason I'm asking is we are close to having to pay US tax on any profits if we sell.
Thanks
What kind of return are you filing? Dual-status? Because if that's the case it's pretty simple, the date you left.

Really it boils down to intent and only you know your intent.
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Old Apr 7th 2014, 6:00 am
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Default Re: When does your UK property stop being your residence

Hi,
can I ask why you pay us tax on the profit of selling your uk house?
(that's how I'm reading your thread).
I was thinking today, about how long I will rent out my uk house, because of capital gains tax this end.
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Old Apr 7th 2014, 6:40 am
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Default Re: When does your UK property stop being your residence

Originally Posted by Smudger222 View Post
Hi,
can I ask why you pay us tax on the profit of selling your uk house?
(that's how I'm reading your thread).
I was thinking today, about how long I will rent out my uk house, because of capital gains tax this end.
Because the US has a $500,000 exclusion on capital gains for married filing jointly ($250,000 for married filing separately or single) if the home was your primary residence for at least 2 of the previous 5 years. After that, the home is considered investment property and capital gains apply without an exclusion.

http://www.irs.gov/publications/p523/ar02.html
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Old Apr 8th 2014, 6:12 pm
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Default Re: When does your UK property stop being your residence

Originally Posted by Michael View Post
Because the US has a $500,000 exclusion on capital gains for married filing jointly ($250,000 for married filing separately or single) if the home was your primary residence for at least 2 of the previous 5 years. After that, the home is considered investment property and capital gains apply without an exclusion.

http://www.irs.gov/publications/p523/ar02.html
mmmmmm.....but why are you filing us taxes on sale of a uk house?
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Old Apr 8th 2014, 6:32 pm
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Default Re: When does your UK property stop being your residence

Originally Posted by Smudger222 View Post
mmmmmm.....but why are you filing us taxes on sale of a uk house?
because the US requires you to file taxes based on your worldwide assets, not just those held or earned in the US.
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Old Apr 9th 2014, 6:36 am
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Default Re: When does your UK property stop being your residence

Originally Posted by lansbury View Post
because the US requires you to file taxes based on your worldwide assets, not just those held or earned in the US.
sorry if I'm hijacking this thread.

So I could potentially have to pay CGT in the Uk, and then be taxed in the USA on it to?
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