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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 13326
Experience:  15years with H & R Block. Divisional leader, Instructor
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I HAVE A REAL ESTATE OWNING IN THE PHILIPPINES, I WANT TO

Customer Question

I HAVE A REAL ESTATE OWNING IN THE PHILIPPINES, I WANT TO SELL IT. I LEAVE HERE IN THE U.S. AND I AM A U.S. CITIZEN. I WILL BE PAYING CAPITAL GAINS TAX OF 7% IN THE PHILIPPINES IF I SELL MY PROPERTY. AM I LIABLE TO PAY ALSO TAXES HERE IN THE U.S. FOR THE PROCEEDS IF I BRING THE MONEYS HERE?
JA: The Accountant will know how to help. Is there anything else important you think the Accountant should know?
Customer: THE APPROXIMATE COST OF THE REAL ESTATE IS $190,000.
Submitted: 4 months ago.
Category: Tax
Expert:  Robin D. replied 4 months ago.

Hello

As a US citizen, even if you leave the proceeds in the Philippines you are still required to report the sale.

You would only pay tax on the gain (difference in cost and sale price).

If it cost you $190,000 and you sell for more than that you would pay tax on the amount over $190,000 you receive.

If you pay tax in the Philippines too, then you can use that as a credit on your US return. That 7% will help reduce your US tax on the sale. Form 1116 is used for that credit.

Please remember that you are required to rate in a positive way (look for the STARS or SMILEY FACES) so I am credited with responding.

Expert:  Robin D. replied 4 months ago.

Hi, just checking back to see if you responded and needed further information.