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Lev, Tax Advisor
Category: Tax
Satisfied Customers: 28081
Experience:  Taxes, Immigration, Labor Relations
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My girlfriend who lives with me here in NYC owns a condo in

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My girlfriend who lives with me here in NYC owns a condo in Russia in which shes selling for around 300k. Her aunt was given power of attorney to conduct this transaction in Moscow. Once the transaction is finalized, how does one transfer the funds into a bank account here in NYC with tax liability? Since these funds are being used to buy another property, is it taxable as income? Can these taxes be avoided by buying a US property?

Lev :

Hi and welcome to our site!
Several issues...
I assume that your girlfriend is an US citizen or US resident for tax purposes.
The fact of transferring funds is not reported to the IRS and not is not taxable.
However - the sale transaction should be reported regardless if funds are transferred or not.
Her taxable gain will be calculated as (selling price) - (basis).
The basis is mainly her purchase price (assuming the property was purchased) adjusted by improvement expenses.
If the property was used as a her primary residence at least two-out-of-last-five years before the sale - the gain - up to $250,000 for single person might be excluded from taxable income.
The fact that the money will be used to purchase another property is not relevant in determination of her tax liability.


She is a resident . Question remains is how can she transfer the funds from Moscow to the USA? Thanks.

Lev :

There is no issue with transfer.
The buyer or her aunt (acting as her agent) may simply transfer funds to her US bank account via wire transfer. She may want to contact her banker to obtain information about international transfers and bank requisites . There is no limitations on transferred amounts as long as she doesn't carry cash over the border.


Thank you...

Lev :

You are welcome.

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Please be aware that
Your bank is required to file a Suspicious Activity Reports (SAR) with the Financial Crimes Enforcement Network (FinCEN), a bureau of the US Department of the Treasury - to report known or suspected criminal offenses, at specified thresholds, or transactions over $5,000 that they suspect involve money laundering or violate the Bank Secrecy Act.
To prevent possible reporting and if you think that your transfer might look suspicious - I suggest to contact your banker - and provide all information about the source of your funds.

But still your girlfriend might want to contact the bank and inform them about expected transaction to avoid possible SAR reporting.
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