How much tax will I pay if I sell land from another country for $50,000 american?

Question

Inheritance of my dad, who is passing it down to me and my siblings. It's been in our family for a long time, but my share is not in my possesion yet. The appraisal is supposedly around $45-50k for an acre of land (the amount of property I would receive).

Answer 1

You don't pay any tax on inheritance. If the property is sold and you get the your share of inheritance, then you don't pay any tax.

If you inherit the property, then you may have to report the sale of the property. Also when you are transferring money to the U.S. you will need to file Form 3520 Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts as the IRS wants to make sure that it is a gift or inheritance.

1. Any thing (money and property) you receive as gift or inheritance, you (the receiver) don't pay any federal tax.

2. If you inherit a property, your cost basis is the valuation (Fair Market Value) of the property at the date of the decedent's death or the FMV (Fair Market Value) on the alternate valuation date if the personal representative for the estate elects to use alternate valuation.

3. If you sell the inherited property at a price up to your cost basis you don't have any taxes due. However, if you sell the property at price more than the cost basis to you, then you pay the taxes on the profit (sale price minus your cost basis).

4. You will report the sale on schedule D of Form 1040.

Answer 2

The casinos and the lotteries ARE taxed. Casinos pay out to the states and localities in which they operate, money earned from the sale of lottery tickets has historically gone towards the schools. Wins are considered income -- meaning people are obligated to report them when they file their taxes, regardless of their size. I'm not sure if this is true of casinos, but with the lottery at least, tax is generally automatically deducted from the larger wins. If Joe Schmoe wins a million dollars, the payments he receives will total three or four hundred thousand less. Military spending can only be decreased so much. Those who are willing to sacrifice -sometimes ultimately- to protect your country, your freedoms, and your way of life deserve adequate compensation. I dislike the War in Iraq, but see it as a necessary evil. I'm all for the war in Afghanistan, and am glad it's no longer on the back burner b/c of Iraq. I'm also glad that the way the wars are funded has been changed. There's a short list of countries that I do not trust, and I believe it's vital this country have a strong defense. Some military spending considered to be wasteful has recently been cut, and some in Congress are fighting to eliminate some more. Unfortunately, eliminating that spending eliminates a lot of jobs, which damages local economies which are already reeling. A good portion of the tax money saved by cutting spending is still spent - unemployment benefits, job training programs, food stamps, revitalization efforts, etc. Military spending is irrelevant, though. Military is a branch of the federal government, and your property taxes fund your locality and state. Given stagnant wages, the state of the economy, and the ever-rising costs of EVERYTHING, suggesting pay deductions is insane. Even if you come out even in the end losing that amount of cash on a weekly basis isn't doable for most. It also inflates the cost as new government workers must be hired to oversee it all. Property taxes are appropriate because they insure that the burden is distributed amongst all those who stand benefit from the services they fund. Name some of these 'many' politicians you claim prefer to buy properties in a foreign country, and then go on to back it up. Provide links to reliable news sources in which they've been quoted as saying such, or provide a list of all properties they own, in and out of the US

Answer 3

Assuming you are a US citizen or legal resident, your US taxes are based on the difference between your tax basis and the sale price. For an inheritance, your tax basis would normally be the value of the property on the date of your fathers death. The 'profit' would be a long term capital gain. Last I checked the maximum rate for long term capital gains was 15%. Depending on your income, you could be subject to a lower rate.

Worst case, 15% of the full $50,000 = $7,500.

Answer 4

How did you acquire the land?
How long have you had it?