Foreign real estate Investing.

[Stanley Cenatus]

I am currently looking to invest in Dominican Republic for short term vacation rental. One of the questions that I am having trouble finding the answer to is when I am collecting my money from a foreign bank and send it to a US bank, do I have to pay any capital gains taxes in the US? I asked my CPA and he was stumped but said he would find the answer for me. I'm curious to know what has other foreign investors experience has been or just some insight on this subject. 

[Mike Lambert]

I'm neither a tax specialist nor a US taxpayer. Yet, the answer seems pretty simple to me but you might want to have it checked by a professional if it isn't obvious to you.

If you have a capital gain, you have to pay capital gains taxes in the US. However, you could deduct the capital gains tax paid in the Dominican Republic courtesy of the tax treaty for the avoidance of double taxation between the two countries (make sure that applies to your case).

However, the simple fact of transferring money between your Dominican bank account and your US bank account doesn't in itself create a capital gain so I'm not sure I understand your question properly.