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Hello and thank you for using Just Answer,The sale of the real property and the US taxation is dependent on the location of the property. Because the real property is located in the US, the corporation will pay tax in the US on any gain form the sale.The rule states that income is not possession source income if, under the rules of Internal Revenue Code sections 861–865, it is treated as income:
From sources within the United States, or
Effectively connected with the conduct of a trade or business within the United States.
Real property includes land and buildings, and generally anything built on, growing on, or attached to land. The location of the property generally determines the source of income from the sale. For example, if you are a bona fide resident of PR and sell your property that is located in PR, the gain on the sale is sourced in PR. If, however, the property you sold was located in the United States, the gain is U.S. source income.
Dear Robin D.
Did you need to respond?
Thanks for your answer, but still don't know what will be the tax percentage to be pay for a Foreign Corporation for selling a property in Miami, Florida. Is it a 15%, or 20% or any other?
There will be withholding of 10% on the total sales price.
Then the corp will need to file a return as a foreign seller and the difference in cost and sale will determine the gain/loss
But do you know what is the percentage ?
The rate would be 15% on any gain
You will be afforded a tax credit in PR though on the tax paid to the US
ok, thanks so much.
You are most welcome
Your positive rating is always thanks enough.
When you sell a property in Miami, Florida. Who is supposed to pay for the expenses, like closing costs. etc.?