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May 26, 2017 - Phil Hodgen

Nonresident Real Estate Investors, Rental Income, and No Tax Returns Filed

What happens to a nonresident who owns U.S. real estate and — gasp — does not report the rental income on a U.S. tax return? What is the tax risk to that nonresident investor? And how can that investor fix the problem?

In this article I will discuss the following topics:

  • How does the United States tax rental income received by a nonresident owner of U.S. real estate?
  • What are the tax return requirements for that nonresident investor in U.S. real estate?
  • What can a nonresident do if he has not filed U.S. tax returns and reported (and paid tax on) the rental income collected?
... continue reading
Friday Edition Nonresidents with US Activities US Real Estate Investments
May 12, 2017 - Phil Hodgen

Independent Contractors Who Become U.S. Residents

Inspiration: Swizec

This newsletter is inspired by a geek with a hat. Swizec is someone whose blog I follow from afar. I also watch for him on Hacker News, where he pops up from time to time. Interesting guy, does interesting things.

So when he wrote a blog post about his international tax catastrophe, I read it with interest.

In brief, Swizec came to California from Slovenia, spent too much time here, and became a resident for tax purposes for multiple years. He ended up with a massive tax bill for Federal and State income tax.

As a bonus multiplier, he ended up owing tax in Slovenia, too.... continue reading

Friday Edition Nonresidents with US Activities
December 9, 2016 - Phil Hodgen

Who’s On the Hook for Withholding Tax Failures?

This week I want to cover a real estate situation, and the perils of being a withholding agent when there is a foreign seller of U.S. real estate.

Foreign Corporation as Seller

From time to time I see foreign corporations as direct owners of U.S. real estate. This can work from a U.S. tax point of view (i.e., it can block the application of estate tax on the real estate if the shareholder dies).

But it creates a host of practical problems. And solving those practical problems will sometimes beget more practical problems.

This time I am going to explore the fine points of withholding tax on the sale of U.S.... continue reading

Friday Edition Nonresidents with US Activities US Real Estate Investments
August 24, 2016 - Phil Hodgen

Why Tax Practitioners Cannot Cash Your Refund Check

People who file Form 1040NR (as nonresidents of the United States) will sometimes receive a tax refund.  Sometimes it is large, sometimes it is small.

The IRS, by default, issues a paper check for refunds.

It will shock you to discover that sometimes paper checks take a long time to reach their overseas destination.  Sometimes the paper checks never arrive.  Or sometimes it is a big hassle to deposit the U.S. dollar denominated check into a bank account overseas.  Or it costs a significant amount in bank fees to get this done.

In short, paper checks are an abomination.

It is possible to have refunds deposited directly to your bank account.... continue reading

Nonresidents with US Activities Random
August 19, 2016 - Phil Hodgen

Nonresidents Buying U.S. Hedge Funds: How it Works

Hello again and welcome to the Friday Edition. Every other Friday, you get some international tax . . . ermmm . . . stuff from me, Phil Hodgen. You subscribed, so don’t blame me. 🙂

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Too Long; Didn’t Read

In a hurry?

  • U.S. income tax results are great for most hedge fund investments made by nonresidents.
... continue reading
Friday Edition Nonresidents with US Activities