A pure guess is that the capital gain rate
is likely to be about 20% in the future. Anywhere from the current 15% to about 25% is possible.
Even though this is an investment, the organization of the LLC may be important in determining if this is effectively connected income (ECI) or not. The default for a multiple member LLC is taxation
as a partnership
but an election can be made to be taxed as a corporation.
You generally must be engaged in a trade or business in the United States
during the tax year to be able to treat income received in that year as ECI. You usually are considered to be engaged in a U.S. trade or business when you perform personal
services in the United States. If you are a member of a partnership that at any time during the tax year is engaged in a trade or business in the United States, you are considered to be engaged in a trade or business in the United States.
So, if the LLC is taxed as a partnership the income will be ECI as will be the gain on the sale of the partnership interest
ECI is, after allowable deductions
, taxed at the graduated rates that apply to U.S. citizens and resident aliens
Non-business or FDPI (Fixed or Determinable Periodic Income) means investment income such as interest and dividends
from publicly traded stocks, securities, commodity futures, options etc. and is usually taxed at a flat rate of 30% on a gross basis (without deduction
A non-resident alien with only US
investment income usually does not have to file a US tax return
as long as the 30% tax is withheld from the source. If the LLC elects treatment as a corporation and dividends are paid the income may be FDPI for you a foreign
investor that does not provide services.
A U.S. partnership that allocates income to a foreign partner faces multiple sets of rules
of federal tax
. For more information see the article at http://www.nysscpa.org/taxstringer/2012/april/booth.htm
"The timing on ECI withholding follows rules similar to those for the estimated tax payments
for corporations. Payments must be made quarterly
8813."Gains and losses
from the sale or exchange of U.S. real property interests (whether or not they are capital assets
) are taxed as if you are engaged in a trade or business in the United States. You must treat the gain or loss as effectively connected with that trade or business; so regular income tax rates will apply to any disposition of real property.
Please ask if you need clarification or more discussion.