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Lev
Lev, Tax Advisor
Category: Tax
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Experience:  Taxes, Immigration, Labor Relations
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I have an investment property in India, if I sell it someone

Resolved Question:

I have an investment property in India, if I sell it someone in USA. How do I record this transaction. How much tax do I have to pay on the capital gain and how would the capital gain be calculated?

Thanks
Sumit
Submitted: 3 years ago.
Category: Tax
Expert:  Lev replied 3 years ago.

LEV :

Hi and welcome to Just Answer!

Customer :

hi Lev

LEV :

If you are US citizen pr US resident - you will report the sale transaction on your US tax return regardless where the property is located and regardless to whom it is siold.

LEV :

The capital gain = (sale price) - (basis)

LEV :

The basis is mainly a purchase price (assuming teh property was purchased) adjusted by improvements and some other expenses depending what is your property.

Customer :

I am US resident on work visa, have been filing taxes for last 6 yrs.

Customer :

do i have submit prove of purchase and improvements made in India

LEV :

Generally - you will report the sale transaction on the schedule D - www.irs.gov/pub/irs-pdf/f1040sd.pdf

LEV :

part I or part II depending if you owned teh property more or less than a year.

LEV :

Long term capital gain rate (not more than 15%) will be used if the property was held more than a year.

Customer :

do I need to attach documents from India of when the property was purchased alongwith schedule D

Customer :

if the property sale is considered short term gain, then what is the maximum tax applicable.

Customer :

lev

Customer :

are you still there and have you logged off.

LEV :

Sorry for delay. You do not need to attach any documents to your tax return. You will need to provide documents if you will be audited.

LEV :

If you held the property less than a year - the gain will be taxed at your regular tax rate depending on your total taxable income.

Customer :

thanks lev for your help, have a nice day

Lev, Tax Advisor
Category: Tax
Satisfied Customers: 22617
Experience: Taxes, Immigration, Labor Relations
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