Buying and selling real estate in the United States (Florida)

Owning a real estate property in the United States is subject to a number of tax implications , if included , will allow a person to buy or sell without a problem. Florida residents enjoy two advantages that may have an impact on non -residents. The first of these advantages is HOMESTEAD EXEMPTION ( HOMESTEAD ) . At first, to encourage northerners to settle in Florida, a law was passed to exempt from municipal taxation the first $ 5000 assessment of residential property . This amount has increased over time and has now reached $ 25,000 , but the exemption applies only to properties of Florida residents . In terms of immigration , the owner must be a U.S. citizen or have legal permanent resident status . Persons staying temporarily in the United States are not eligible , even if they have a visa, whatever.

The second advantage is granted to residents amendment 10 SAVE OUR HOMES , of the Florida Constitution , which applies to properties covered by the exemption for homestead. This amendment limits the annual increase in the assessed value of a homestead to three percent or the increase in the index of consumer prices , following the increase in the lower of the two . Each year the exemption applies as long as a Florida resident owns property .

However, if the property is sold to a resident or a non- resident of Florida, property evaluation will be made at market value for the first year of ownership , with corresponding fees. If the new owner is entitled to homestead exemption , he must make the request and the exemption will apply to the new evaluation .

With the purchase of a property, so be aware of these effects on the calculation of taxes to be paid by the new owner . If the property was entitled to the exemption, the fees could be considerably higher in the first year compared to the previous year.

The sale of a property right has federal income tax in Florida. All winnings are taxable. However, if a property was purchased prior to November 1984, its value at that date will be the starting value, regardless of the purchase price of the property. In calculating the gain , it is possible to deduct things like the purchase price of the property, the sale price of the property, the cost of improvements , special assessments and taxes paid in the year of sale. Currently , the tax on the gain rate is 15%, but by counting the exemptions contained in the statement of income, it is about 12 %.

For the U.S. government receives tax owed ​​a tax collection system has been established. In general, ( a procedure to determine in advance the amount of the tax and pay only the actual tax due) , the conclusion of the sale , the company title search deducted 10% of the sale price and sends the resulting amount to the federal government . The law requires parties to the sale or the seller , real estate agent or company title search , the obligation to ensure that this amount is sent within 20 days of the conclusion of the sale, otherwise they will be responsible . The procedure avoids the withholding tax is very complicated , it must provide all relevant information to the government , then wait for the amount of the tax is established. Most of the time , this procedure is not practical , because it must be concluded sale and exemption certificate may take time to arrive.

Once the sale is concluded , a claim for overpayment may be submitted if the 10 % selected are greater than the actual tax due. There are two ways to proceed: apply immediately send all relevant information to the tax authorities and to calculate or wait until the end of the year and apply by filling income tax declaration form not 1040NR -residents . This method is simple, because it only include numbers on Form 1040NR , while the other method requires the submission of all documents to justify the numbers.

To request a refund , the taxpayer identification number ( Taxpayer Identification Number - TIN) is mandatory. Anyone requesting a refund must have a tax number. If there are two owners, the proceeds from the sale will be divided between them and a separate restraint has been imposed on each. They must make a separate application ID .

Until recently, a person could apply for a TIN without having to explain the reason for his request. This reason should now be provided and justified by documents. In the case of a sale for which a claim is submitted, the request TIN is attached to the refund request . The office issuing TIN receives two requests , and sends the number listed on the rebate application and forwards it to the tax authorities . The office also sends a notice informing the applicant of the number. At one time, the sale of a property to a foreigner could not be completed if the person did not have this issue , but this formula too restrictive has been replaced by the above procedure .

People who have a social security number do not have to request a TIN , as their number is tax number. Foreigners can not get social security number unless they are authorized to work in the United States .
With this information , the non-resident property owners can better understand the procedures to buy or sell a residential property. Mobile homes are not covered by these procedures, unless the land belongs to the owner of a mobile home , and owning a share of a mobile home park is not considered a property of the field.