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The Complications Of Being A Foreign Citizen Buying Real Estate In Sacramento
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If you are a foreigner, can you still buy a property in the US? This is a very common question that a lot of people are always asking whenever they are planning to buy a house in the United States. The answer is yes, but you would need to prepare more documents compared to a US citizen. Instead of showing you all the possible problems that you may encounter as a foreigner, this article will be focusing more on the things that you need to prepare in you are planning to buy a house in the US. This will help you understand all the possible solutions that you need to do in order to invest in the real estate industry.

Here are some of the most basic requirements that a foreigner would need to have before he can get a real estate property in the US:

1. FIRPTA (Foreign Investment in Real Property Tax Act)

The first thing that a foreigner should have is a Taxpayers Identification Number (TIN). This is something that is required in every state, and you should never forget about having it before you even start to look for a property that you can buy. It would be better if this is the first thing that you have, because this will be the first thing that you need whenever you want to buy a real estate property.

2. Income Tax

30% of your income as a foreigner will be deducted from your gross income. If you are not aware of how you can work on the "net election" you won't be able to do anything about the percentage of the tax. This is the reason why foreign Investors are advised to get someone who is familiar with tax laws, which will enable him to reduce the amount of expenses that he has before the tax will even be collected from him.

3. Title Decisions

You need to make sure that you are going to make it clear in your statement whether the property will be bought by an individual, a foreign corporation, or a US corporation. If you are going to work on this process, getting an accountant or a lawyer who has a lot of experience in international laws is very advisable. This will save you from all the potential problems that you may encounter while negotiating with the seller of the property.

4. Capital Gains Tax on Sales

If you would like to determine this figure, then you need to make sure that you are aware of this formula:

Price Sold - Original Price + Capital Costs - Depreciation = Capital Gain.

Normally, you need to spend 20% for the taxes, and it would take some time before you can reinvest in another Sacramento real estate. Again, it would be better if you have a professional lawyer with you, who can help you make your decisions and give you advises based on your current condition. This will also help you minimize the problems that you will encounter when buying a real estate in Sacramento.


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