Non-US sellers ?

[Dividends]

I have yet to buy and i'm already looking to sell.


The sellers contract on non sponsor website says

Non-US Citizens will be assessed a 10% FIRPTA Tax on the selling price, which will be subtracted from the proceeds at time of closing and sent to the Internal Revenue Service by the title company in behalf of the buyer for taxes due on sale of property by a non-US citizen. Seller may file with the US Government to receive a refund as the tax is due ultimately only on the profit.

Has anyone contacted the IRS for the refund? Was it fairly easy to get their money back?

Im thinking if i buy at a bargain $100pt even if i could resell it again at 100pt i'll be eating 10% commission and 10% tax im getting $80 for that $100 point unless i can guarantee that refund.

 

[Annielkd22222]

I have yet to buy and i'm already looking to sell.


The sellers contract on non sponsor website says



Has anyone contacted the IRS for the refund? Was it fairly easy to get their money back?

Im thinking if i buy at a bargain $100pt even if i could resell it again at 100pt i'll be eating 10% commission and 10% tax im getting $80 for that $100 point unless i can guarantee that refund.

Everyone loses money when they sell. I bought at like 130 a point, and now I'm selling at 100 a point.....people buying right now direct will pay 160 something a point and lose even more. I don't think anyone buys DVC as an investment like a house.

 

[Dividends]

The guys who bought in 90s are making a profit, but.

I dont want to take an additional loss of 20% when selling

 

[Annielkd22222]

The guys who bought in 90s are making a profit, but.

I dont want to take an additional loss of 20% when selling

Not much of one.....don't buy hoping to make a profit, the reason to buy is to have exciting trips with good accommodations.

 

[Dividends]

Thank you for the replies.

I dont want to buy and sell to make a profit,

im just looking down the road if i bought resale today, lost my job in 10 years and couldnt afford $12pt MF. If i had to liquidate at $50 a point i'd be out my original $50 investment,

But also another $5pt for commission(ok fair enough) but another $5 for the taxman, which isnt profit so i have to apply to show that its not profit.
I just want to know how easy it is to get the money back from the IRS so i can recoup the $5.

 

[McCrae]

I have yet to buy and i'm already looking to sell.


The sellers contract on non sponsor website says



Has anyone contacted the IRS for the refund? Was it fairly easy to get their money back?

Im thinking if i buy at a bargain $100pt even if i could resell it again at 100pt i'll be eating 10% commission and 10% tax im getting $80 for that $100 point unless i can guarantee that refund.

Have you spoken to anyone at DVC about this?

 

[Dividends]

Have you spoken to anyone at DVC about this?

I've emailed the brokers about it, as soon as i saw that hiccup..

I'm sure Disney will say same thing as others, "why would you want to sell" or "its easy to get the tax back"

I just wanted to ask the forum if any non residents have sold and if getting the cash back was easy.

 

[drusba]

That 10% holding of the foreign seller's sale price is to assure foreign sellers pay any capital gains tax required. After the sale you then have to submit a tax form on which capital gains if any are calculated (ask the broker or title company involved in the sale who can supply the form and help you with it). If there is in fact a loss, e.g., the sale price minus your original purchase price and costs for the sale is a negative number, you get back that 10% withholding. If it is a positive number, you determine the actual tax owed (currently about 23% maximum on the profit made -- consisting of a capital gains tax and a medicare tax). That number owed will almost always be much less than the 10% withholding on the sale price for a DVC sale and you will get a refund.

Note, that 10% withholding and then file to get back money applies to every sale of any property in the US made by a foreign seller and it is not something limited to DVC or timeshares. Brokers and title companies are usually familiar with it and what needs to be done. In fact, in this situation contacting DVC as to what to do would be pointless.

 

[Dividends]

Thanks so much... Good to know its common place and IRS does this to all foreigners.

 

[MoreTravels]

Do you know that you also have to apply for a SSN or ITIN? You will officially create an account with the American government. You may be asked to submit an American tax return as well. Your record will be saved with IRS and NSA. You will be in their radar from now on even if you never intend to become an American resident. If you have to stay too long, you may be requires to report your worldwide asset just like an American citizen. There are also FATCA laws that many non-American is trying to escape from.

Let's say you are a British or Chinese, owning a few rental properties. If you are not careful, the American may have a claim on those unrelated incomes as well.

In my opinion, it's not worth the troubles for any foreigner to go for it.

 

[MoreTravels]

Thanks so much... Good to know its common place and IRS does this to all foreigners.

IRS loves foreigners.

http://en.m.wikipedia.org/wiki/Foreign_Account_Tax_Compliance_Act

 

[MoreTravels]

This was just published by Yahoo on October 18

http://ca.finance.yahoo.com/blogs/pay-day-/canada-snowbirds-know-u-taxes-161842793.html

It listed:

"Under the current rules, those who spend more than 182 days out of 365 days in the calendar year, or more than 120 days per year on average over a three-year period, may be considered a U.S. resident for tax purposes."

and

"A government regulation stipulates that, if you own an American property when you die and your worldwide assets are worth more than US$2million, that property is subject to a 45-per cent estate tax."

On the other hand, many countries like Canada and elsewhere, do not have any estate / inheritance / gift tax.

You may want to keep this in mind when you own DVC and use it frequently.