Sold US house - tax liability in Ireland?

Jetset

New Member
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4
Posting on behalf of old age pensioner (Irish)

Sold house in US (had been left to him by relative)
No US income tax to be paid as proceeds of sale is under limit of 300K and also he is non-resident in US. (real estate taxes have been paid/settled)
No US bank a/c

What is the best way of bringing back the funds to Ireland and also what tax liability would there be and what ways of reducing tax liability?
 

dublin67

Frequent Poster
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285
The capital gain, if any, is the difference between the Euro value of the property at date of death and the Euro value of the sale proceeds at date of sale. Costs of sale (estate agent, legal fees etc) can be deducted. He will have his personal allowance of €1,270 available and this is assuming that he didn't make any other gains.

Capital Acquisitions Tax (inheritance tax) is likely to be be a bigger liability. This applies where the recipient (or the donor) is Irish tax resident and wil need to be examined.
 

RedOnion

Frequent Poster
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3,791
An extremely complex area, and my knowledge is at best (and I'm being generous to myself) a high level. There are specialised tax advisors that look at these things every day, and a few hundred euro would get you proper robust advice. Personally I think it'd be well spent on an inheritance worth 300k to know you've done it right.

There are some things unclear in your post, and the following might explain why it's not a simple black & white answer:
Was it an inheritance, and not a gift?
Was it sold immediately, or did they keep the house for a while?
Was the disponer Irish domiciled?
And were they resident in the US?

There is a tax treaty between Ireland and US that specifies the treatment of inheritances CAT. If the disponer was US resident, and not Irish domiciled, this would be typically exempt from inheritance tax Ireland.

 

Jetset

New Member
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4
Many thanks for all replies...much appreciated!

*It was an inheritance from his aunt
*House was inherited 30 years ago,and has been rented for last 30 years and sold last year
*Disponer not Irish domiciled
*Disponer resident in the US

Any way he can open a US bank a/c for the moment and bring back dollars when he is happy with exchange rate?
 

RedOnion

Frequent Poster
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3,791
*House was inherited 30 years ago,and has been rented for last 30 years and sold last year
Ah, I misunderstood your question as being an inheritance one.

@dublin67 has correctly interpreted is as being a capital gains issue, so covers the tax piece.

US banks aren't keen about opening non resident bank accounts.

For an amount of 300k, he should check with his bank. They should provide a quote directly from dealing desk for amounts that size, so more competitive than the rates you get charged in branch. It's messy with a cheque though as it can take weeks for funds to clear.
 

Jetset

New Member
Messages
4
Many thanks RedOnion and Dublin67!

Confirming:

*No to CAT
*Yes to CGT at 33% -'The difference between the Euro value of the property at date of death and the Euro value of the sale proceeds at date of sale. Costs of sale (estate agent, legal fees etc) can be deducted. He will have his personal allowance of €1,270 available and this is assuming that he didn't make any other gains.'
 

Palerider

Frequent Poster
Messages
1,479
There is no problem opening an account with a US Bank. Present yourself with passport and drivers license. I opened one last year.

You can leave the funds there until you want to bring them home, then use Currencyfair for the conversion rather than your Bank as the rate will be better, that said the Dollar is strong at the moment and it’s s good time to consider bringing dollars back.
 

RedOnion

Frequent Poster
Messages
3,791
There is no problem opening an account with a US Bank. Present yourself with passport and drivers license. I opened one last year.
Correct, sorry. I was completely wrong with what I said (me taking shortcuts again!). You don't need to be a US resident, but you need to be physically present to open an account.
 
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