I am planning to buy property abroad. I don't have bank account there so I am planning to wire money to my sister and she will pay seller. Since there will be large sum, how this needs to be reported to IRS on my tax return?
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(a) which country ?
(b) Are you a US person ( citizen/GreenCard/Resident for Ta purposes ) ?
(c) Generally there is no tax even or reporting requirement when you transfer post tax monies abroad. However, your bank in the US will raise a SAR ( Suspicious Activity Report ) as a matter of course. These usually result in nothing. If the amount is in the millions, and/or to a country on sanction list , you will have to get permission from the US treasury.
Is there more I can do for you ?
(a) which country ?
(b) Are you a US person ( citizen/GreenCard/Resident for Ta purposes ) ?
(c) Generally there is no tax even or reporting requirement when you transfer post tax monies abroad. However, your bank in the US will raise a SAR ( Suspicious Activity Report ) as a matter of course. These usually result in nothing. If the amount is in the millions, and/or to a country on sanction list , you will have to get permission from the US treasury.
Is there more I can do for you ?
a/ Montenegro
b/ Yes I have US citizenship
c/ The purchase price will be around $385K.
Since I will be transferring money to my sister account, is this considered a gift for tax purposes. even though she is going to buy property for me and in my name. I gave her authorization to do that.
Then I need to file form 709 correct? I was told, if i send money oversees to any account other than my own, it is considered a gift, no exceptions.
My understanding is that I won't owe any taxes until 12 Million limit is reached.
Thanks
@almi26 , a beautiful country, from pixes.
I do not believe this is a gift. A gift would be if you gave something ( of value ) to someone and expecting / receiving nothing in return.
In your case you are having your sister providing a service to you -- the money is yours and after the transaction, the property is yours. She is gifting her time/ effort and ac ting as your agent. So I do not believe you have to file a gift form with the IRS.
For future reference, please keep all records of expenses in acquiring this prop. -- whether you use it as income property , second home or whatever , you will need to establish your basis at the time of acquisition.
Is there more I can do for you?
That totally make sense, thank you very much for your advice.
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