Accepted Answer

Hello Horace,

If you are having a property management firm handle and collect the rents on your behalf, then they are required to withhold 30% withholding tax from the rent before sending the balance to you. The form W-8BEN is only used in a case where you are claiming an exemption from withholding or a reduced rate, and neither apply in this case.

If you are collecting the rent directly from the individual who is renting your property, then that individual will not withhold any tax, and it will strictly be up to you to report your income and expenses and pay any taxes that are due.

At the end of the year you will need to file a tax return with the IRS using Form 1040NR for non resident aliens. You must report all of your rental income and expenses, and then your net income from the rental activities will be subject to US tax.

The US tax forms and rules can be complicated, so if you are not familiar with these forms, I strongly suggest that you seek the assitance of a tax professional to help you with this filing.

If this was helpful please press the Accept button.

Thank you Horace

Expert:	Merlo
Pos. Feedback:	99.8 %
Accepts:
Answered:	10/28/2009

Accountant

25+ years tax consulting. Specializing in returns for US citizens living abroad