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Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 28094
Experience:  Taxes, Immigration, Labor Relations
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Hello LEV, Again in the case of the sale of the San Diego,

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Hello LEV,
Again in the case of the sale of the San Diego, California house:
What would be the form in California in order to pay the State Income Tax deducting basis from sale price instead of applying the 3.3% withholding rate?

LEV :

Hi and welcome to Just Answer!
I need some clarification... What are you selling ? Who are the buyer and the seller?

Customer:

Selling a house.

Customer:

Seller mexican resident for tax purposes

Customer:

Buyer a US resident for tax purposes

LEV :

In this case - withholding is based on the sale price - but you will be able to file the tax return in January and calculate your actual gain and actual tax liability based on that gain - and will be refunded the difference if overpaid.


The withholding agent generally will not consider your gain – but the sale price only.

Customer:

I understand so, but me as a non resident in USA or California, should I ask for a Tax ID number in California in order to be able to file a tax return?

Customer:

An if I know in advance that teh withholding will be more than the income tax computed at the end of the year, is ti possible to prevent such withholding in CA?

Customer:

If so, what form is needed?

LEV :

should I ask for a Tax ID number in California in order to be able to file a tax return?
Yes - you need to have an ITIN - tax ID and provide that number to the withholding agent - so the amount withhheld will be reported to your account.

LEV :

An if I know in advance that the withholding will be more than the income tax computed at the end of the year, is ti possible to prevent such withholding in CA?
California law requires withholding of 3 1/3 percent (.0333) of the total sale price.
Alternatively, you may elect to withhold on the gain on sale and apply the rate 9.3% for individuals on the gain.



Customer:

Thanks a lot

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