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Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 28082
Experience:  Taxes, Immigration, Labor Relations
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I am a card holder, resident in the US years. My father

Customer Question

I am a green card holder, resident in the US for 15 years. My father recently died. His house (in the UK) has just been sold & is jointly owned between myself & my sister (she has her own house in the UK) Do I pay capital gains tax in the UK? Am I also liable to be taxed in the US? What would be the correct procedure? I would appreciate some advise & guidance. Thanks
Submitted: 1 year ago.
Category: Tax
Expert:  Lev replied 1 year ago.

I will address your US tax responsibilities.
First of all as a resident alien you have same tax liability as other US persons.
-- You are required to report the fact of receiving inheritance on form 3520 - if the total amount is above $100,000 -

http://www.irs.gov/pub/irs-pdf/f3520.pdf
-- you need to report the sale transaction on your tax return and calculate your gain or loss on that sale.
The gain = (selling price) MINUS (basis) MINUS (selling expenses)
The basis for inherited property is equal to the fair market value at the time the decedent passed away.
So - if the property value appreciated after your father passed away - there might be some taxable gain - but most likely - there is no gain and no tax liability.

Expert:  Lev replied 1 year ago.

The sale transaction is reported on form 8949 - as an US person - you report the sale transaction and calculate your taxable gain realized from that transaction.

The fact of transferring the money is not reported on the tax return.

However - if you will have a foreign bank account in your name - that fact is reported to FinCen on FBAR form (for amounts above $10,000.

In additional - on form 8938 - we report the fact of having foreign financial accounts - if you have bank accounts in a foreign country - and the total value is above $$50,000.
So - if the buyer transfer the money to you directly to the US account - no need to use form 8938. However - if you have a bank account in a foreign country and the money are transferred to that account - then - you will need to use form 8938 with your tax return. FBAR is separate reporting - it is sent to FinCen - not to the IRS.
FBAR is ONLY filed online

http://bsaefiling.fincen.treas.gov/main.html

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