Sent: Tuesday, October 11, 2005 11:02 AM To: taxman at centa.com; centapede at lists.centa.com Subject: Selling raw land in Washington State. Hi David. I bought a piece of property in Washington State 15 years ago. I claimed this property as my $100,000 capital gains excemption in 1994. I am now selling this property for a substantial gain (not $100,000) . Is there any way to avoid paying American taxes ? What is the best way to proceed with this transaction from a tax perspective? XXXXXXXXs ----------------------------------------------------- david ingram replies: The Canadian up to $100,000 exemption in 1994 had no effect on any property physically in the US. There was an exemption up to Jan 1, 1985 for the US but you have e only owned it since 1990 or so. You will have e to file a 1040NR and pay tax to the US federal government first. The sale is also subject to US AMT (alternative minimum tax) and you must fill in US form 6251 along with the 1040NR, Pay particular attention to the instructions which show you how to put the real estate sale profit on line 30 of the 6251 which changes the obvious calculation. You also write in RPI (for Real Property interest) to the left of line 30. I have yet to see a computer tax program that does this properly by the way. The best way to proceed is to get the best price and then do the return when required. failure to file a return for a non-resident sale carries an automatic penalty of $1,000 to $10,000. Then you have to recalculate the profit for the Canadian return. THERE WILL BE A TAXABLE PORTION because it was impossi ble to use up all the profit on the T664 you filed in 1994. This was b because there was still a taxable portion from Feb 25, 2002 to Feb 22, 2004. If you need help (and you will) there is not any better place to take your return. david Answers to this and other similar questions can be obtained free on Air every Sunday morning. Every Sunday at 9:00 AM on 600AM in Vancouver, I, david ingram am a permanent guest on Fred Snyder of Dundee Wealth Managers' LIVE talk show called "ITS YOUR MONEY" Those outside of the Lower Mainland will be able to listen on the internet at www.600AM.com Call (604) 280-0600 to have your question answered. BC listeners can also call 1-866-778-0600. Callers to the show and questioners on this board can also attend the Thursday Night seminars on finance and making your Canadian Mortgage Interest deductible. David Ingram's US/Canada Services US / Canada / Mexico tax, Immigration and working Visa Specialists US / Canada Real Estate Specialists Home office at: 4466 Prospect Road North Vancouver, BC, CANADA, V7N 3L7 Cell (604) 657-8451 - (604) 980-0321 Fax (604) 980-0325 Calls welcomed from 9 AM to 9 PM 7 days a week (please do not fax or phone outside of those hours as this is a home office) email to taxman at centa.com www.centa.com www.david-ingram.com Disclaimer: This question has been answered without detailed information or consultation and is to be regarded only as general comment. Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader and the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent and appropriately qualified legal practitioner or tax specialist in connection with personal or business affairs such as at www.centa.com. If you forward this message, this disclaimer must be included." Be ALERT, the world needs more "lerts" Every Thursday Evening, Fred Snyder of Dundee Wealth Management conducts one of 17 different financial seminars at his office Time: 7:00 to 9:30 PM Date: Every Thursday evening Place 1764 West Seventh Vancouver (corner of burrard) Phone (604) 731-8900 to register No cost - no obligation Topics always cover mortgage interest as a deduction other topics - getting the mortgage, estate planning, critical care insurance, income taxation, differences between stocks and bonds, and usually the most innovative HELOC mortgage offered in Canada from Manulife Bank This from "ask an income tax and immigration expert" from www.centa.com or www.jurock.com or www.featureweb.com. David Ingram deals on a daily basis with expatriate tax returns with: multi jurisdictional cross and trans border expatriate problems for the United States, Canada, Mexico, Great Britain, the United Kingdom, Kuwait, Dubai, Saudi Arabia, Thailand, Indonesia, Japan, China, New Zealand, France, Germany, Spain, Italy, Russia, Georgia, Brazil, Peru, Ecuador, Bolivia, Scotland, Ireland, Hawaii, Florida, Montana, Morocco, Israel, Iraq, Iran, India, Pakistan, Afghanistan, Mali, Bangkok, Greenland, Iceland, Cuba, Bahamas, Bermuda, Barbados, St Vincent, Grenada,, Virgin Islands, US, UK, GB, and any of the 43 states with state tax returns, etc. Rockwall, Dallas, San Antonio and Houston Texas Denmark, Finland, Sweden Norway Bulgaria Croatia Income Tax and Immigration Tips, Income Tax and Immigration Wizard Income Tax and Immigration Guru Income Tax and Immigration Consultant Income Tax and Immigration Specialist Section 216(4) 216(1) NR6 NR-6 NR 6 Non-Resident Real Estate tax specialist expert preparer consultant expatriate anti money laundering money seasoning FINTRAC E677 E667 105 106 TDF-90 Reporting $10,000 cross border transactions Alaska, Alabama, Arkansas, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Garland, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon. 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