Question by alexmunro1971: Am I liable for US tax after selling my Dubai rental property?
I am working in the US on a L1 Work Visa and have been here 2 years. I bought a condo in Dubai (tax free country) in 2004 and want to sell it to help finance a home here in the US. Obviously having invested in Dubai the idea was to avoid taxes, will I be liable once I move the proceeds from the sale to the US?
Best answer:
Answer by v b
You are considered a resident alien for tax purposes. Resident Aliens are taxed on worldwide income, so the gain from selling the property in Dubai is taxed at 15% on your 1040. You are liable at the time of sale, whether or not you bring the funds to the US.
By the way if you have ANY bank accounts with a balance of ,000 or more, you need to report them once a year to the Treasury on form TDF 90-22.1.
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L1 is work visa. You must file resident tax return after you complete substantial presence test. So you are resident. You must report your worldwide income; you must report profit from sale of condo.
You have long term capital gain that will be taxed at 0 or 15%.
On your U.S. return, you must report your worldwide income. Read: http://taxipay.blogspot.com/2008/03/us-citizen-or-resident-with-foreign.html
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