Foreign investors and their American counterparts generally share the goal of
minimizing income tax liabilities from their US real estate investments. This
rather straightforward aim is complicated by the fact that non-US investors
must be concerned not only with income taxes in the United States, but in
their home country as well. What's more, the United States has a special
income tax regime that’s applicable to foreign persons. It’s quickly evident
to those involved that this is a complex area subject to new developments as
the US Congress continually entertains new tax laws (and other statutes with
relevant impact like the PATRIOT Act), the Internal Revenue Service
promulgates regulations, rulings, announcements and interpretations, and the
US courts issue opinions impacting the area.
This timely and highly practical resource is designed to explore the
considerations that are of unique concern to foreign individuals and entities
making US real estate investments. To that end it details the US income,
estate and gift tax aspects of inbound investment in US real property and the
various structural techniques that may be employed to reduce or eliminate US
tax liability under these domestic laws. This work's single-minded focus on
real estate, the encyclopedic coverage of relevant tax considerations, and
extensive materials on non-tax issues (asset protection, non-tax reporting,
limits on foreign ownership of U.S, real estate, etc.) make it an essential
resource for non-US investors and their advisers.
Structuring Foreign Investment in US Real Estate covers:
• General rules for taxing inbound investments by non-US persons
• System for taxing operating income from foreign-owned US real estate
• Regime for taxing dispositions of US real estate by non-US owners
• Withholding obligations of purchasers of US real estate from non-US sellers
• Impact of tax treaty network on US taxation of inbound real estate
investment
• Limitations on non-US ownership of US real estate
• Reporting obligations for non-US owners of US real estate
• Planning for acquisitions and dispositions of US real estate by non-US
persons
• Estate and gift tax planning for foreign-owned US real estate
This one-volume looseleaf answer questions, such as:
• How is direct foreign investment in US real estate taxed?
• How is portfolio investment in US real estate taxed?
• What are the seller’s and buyer’s tax obligations when foreign-owned US real
estate changes hands?
• What planning techniques are available to non-US persons for holding and
disposing of US real estate?
• What reporting obligations are associated with foreign ownership of US real
estate?
• Are there limitations on the ability of non-US persons to own US real
estate?
• What impact do tax treaties have on planning for foreign investment in US
real estate?
• What state and local tax issues arise on inbound investment in US real
estate?
• What estate and gift planning should be done for non-US owners of US real
estate?
Chapter 1 The `Ground Rules' of the Internal Revenue Code: Rental
Income
Chapter 2 The `Ground Rules' of the Internal Revenue Code: Interest,
Dividends and the Branch Profits Tax
Chapter 3 The `Ground Rules' of the Internal Revenue Code: Sales and
other Dispositions
Chapter 4 Enforcement of the FIRPTA Tax: Withholding
Chapter 5 The Effect of Tax Treaties on the Code Ground Rules
Chapter 6 Legal Structure Alternatives
Chapter 7 Special US Tax Planning Techniques and Considerations
Chapter 8 US Estate, Gift, and Generation-Skipping Taxes
Chapter 9 State and Local Considerations
Chapter 10 Transfer of Ownership of US Real Property under a “Home
Country” or US Will
Chapter 11 Planning Techniques to Avoid US Probate of a Will
Chapter 12 Introduction to Federal Disclosure Laws with Respect to
Foreign Investment in US Real Estate
Chapter 13 Responding to Foreign Direct Investment: Current Federal
Disclosure Laws from an Historical Perspective
Chapter 14 Disclosure of Real Estate Investments under the
International Investment Survey Act of 1976 (Reentitled the International
Investment and Trade in Services Survey Act) (the IISA)
Chapter 15 Disclosure, Requirements of the Agricultural Foreign
Investment Disclosure Act of 1978
Chapter 16 The FIRPTA Disclosure Requirements
Chapter 17 State Restrictions and Reporting Requirements
Chapter 18 Structures to Protect US Assets against the Effects of
Foreign Political Emergencies
Chapter 19 Structures to Protect US Assets against Freezing or Vesting
under the US Trading with the Enemies Act and Related Laws
Chapter 20 Structures to Protect US Assets in Insolvency Situations
Appendix A Internal Revenue Code Sections 861-897 Appendix B Internal Revenue
Code Sections 1441-1446; 1461-1464; 6039C Appendix C Income Tax Regulations
Issues Under Code Section 897 Appendix D Income Tax Regulations Issues Under
Code Section 1445 Appendix E Internal Revenue Code Sections 2001; 2003-2041;
2051-2055; 2102-2108; 2501-2551; 2061-2663 Appendix F The Agricultural Foreign
Investment Disclosure Act of 1978 Appendix G The International Investment
Survey Act of 1976, re-entitled ‘The International Investment and Trade in
Services Act’ Appendix H Instructions for FIRPTA Withholding Certificate
Applications Appendix I Internal Revenue Service Form 8288-A (Statement of
Withholding on Dispositions by Foreign Persons of U.S. Real Property
Interests) Appendix J Internal Revenue Service Form 8288-B (Application for
Withholding Certificate for Dispositions by Foreign Persons of U.S. Real
Property Interests) Appendix K Internal Revenue Service Revenue Procedure
2000-35
