Tax Demand?

[Scottk]

Hi Everyone, I have 4 DVC contracts and out of the blue a couple of years ago I received and IRS demand for tax year 2018 for a fairly significant amount ($1,000) . I am a UK citizen with no other US assets apart from DVC and I only visit the US on vacation. There was no other information available as to what the tax demand was for and I have never submitted a US tax return as I have no US earnings. I contacted them inititally by phone (as they have no email address in use) back in 2020 when the initial demand arrived for tax year 2018 and was told to put my issue in writing, which I did by both letter and fax. The letters and faxes have never been acknowledged. I now seem to be getting a revised demand including a small amount of interest increase at least once and sometimes twice a year. I write and fax back every time as I am unable to get through by telephone, but none of this correspondence is acknowledged. I can only assume this is related to my 2018 purchase of a contract so I checked my 2018 purchase, which was from another international seller and my broker did deduct the FIRTPA tax from the seller so I am struggling to understand where this tax demand came from.

Has anyone got any experience of this kind of situation and any advice of how to proceed would be much appreciated!

 

[Ruttangel]

I would get back in touch with title company as they should have passed that on

 

[Scottk]

I would get back in touch with title company as they should have passed that on

Thants not going to help as I need to talk to IRS regardless as they have issued the tax demand to me - I'll try calling again and see if that works

 

[Ruttangel]

Thants not going to help as I need to talk to IRS regardless as they have issued the tax demand to me - I'll try calling again and see if that works

I bought a BWV contract from someone in Colombia and title company withheld the FIRPTA amount from the sellers proceeds and sorted it out for me. Just wondered if your title company did the same with those proceeds, if they added it to your balance to pay over then fair enough, otherwise sounds like they have messed up

 

[Scottk]

No they held back the balance which was $4k, but this demand is for just under $1k which is weird -I'll send them a mail to see if they can shed any light on it. Lack of an email or messaging service with the IRS is really irritating to get to the bottom of this.

 

[McCrae]

No they held back the balance which was $4k, but this demand is for just under $1k which is weird -I'll send them a mail to see if they can shed any light on it. Lack of an email or messaging service with the IRS is really irritating to get to the bottom of this.

Are you sure this is not a SCAM? You should have no tax liability.

 

[Minniesgal]

No they held back the balance which was $4k, but this demand is for just under $1k which is weird -I'll send them a mail to see if they can shed any light on it. Lack of an email or messaging service with the IRS is really irritating to get to the bottom of this.

This sounds about right they hold back way more than the tax that is due. Sounds like the seller didn't do a US tax return so the IRS don't know the Tax isn't due. When it isn't paid by the seller the IRS go after the new owner. you need to speak to the closing company urgently to find out what they did before speaking to the IRS. Persoanally I'd get a tax advisor on it.

what you will most likely have to do is get a TIN and do a tax return for 2018.

This isn't your bill to pay but you might have to do the paperwork to prove that.