If you have a US C Corp that is owned by a Foreign Company, and the US C Corp sells property that it has an interest in, doesn't the US C Corp still have to pay the corporate tax rate of 21% on the gain?
Sir, Thank you for the clear explanation. I have a question, the 20% capital gains tax that'll be taken from the 15% FIRPTA withholding, does it apply if the foreign owner self occupied the home for the past 2 years? In other words, does the 250K capital gains exemption apply if the property was primary residence of a person for the past 2 years, but has left US this year and became a foreigner.
The 15% FIRPTA withholding needs to be done regardless of whether the $250K exclusion applies. I would need more info about the foreigner to determine if they qualified for the $250K exemption, but a foreigner can qualify for the exemption. If they did, they’d get the entire FIRPTA withholding back as long as the gain wasn’t more than the exemption.
Awesome explanation. Thank you for the information!
If you have a US C Corp that is owned by a Foreign Company, and the US C Corp sells property that it has an interest in, doesn't the US C Corp still have to pay the corporate tax rate of 21% on the gain?
Yes.
When you say to own a corporation, would an LLC count? Or does it have to be something like an S or C Corp ?
Thank you
Needs to be a C Corp.
Sir, Thank you for the clear explanation. I have a question, the 20% capital gains tax that'll be taken from the 15% FIRPTA withholding, does it apply if the foreign owner self occupied the home for the past 2 years? In other words, does the 250K capital gains exemption apply if the property was primary residence of a person for the past 2 years, but has left US this year and became a foreigner.
The 15% FIRPTA withholding needs to be done regardless of whether the $250K exclusion applies. I would need more info about the foreigner to determine if they qualified for the $250K exemption, but a foreigner can qualify for the exemption. If they did, they’d get the entire FIRPTA withholding back as long as the gain wasn’t more than the exemption.
How could the foreign owner "self occupy" the house?
But in this structure there is no raise in cost-basis of assets when you die. You can never-ever cash out.
While that’s true, the estate tax charged to a nonresident alien far outweighs the step-up basis at death.
STD?! hahaha, nice.
Lol...