All Forum Posts by: Mylene Bel

Hi BiggerPockets,

I came across this video (haven't had time to watch it through the end yet): https://youtu.be/oQJRGgTBn6w

The economist James Dale Davidson, who got famous from predicting the subprime crisis among other things, believes that the US economy is about to collapse in 2017 and that real estate will drop 40% in the next...six months!

What do you guys think of this warning? 

For me it seems too spooky to be realistic but apparently that guy was right several times in the past...

I would be curious to know your thoughts ;)

I'm already talking with @DaveFoster and he has offered great advice! I was just wondering if selling as a LLC would simplify things by avoiding the 1031. But apparently not.

@Cameron Skinner thanks for the explanation. Since I'm not a US resident alien I won't fill 1040NR but 8888-B so it will take three months to get refunded from the withheld amount.  So I'll have to wait for my next investments (unless I do a 1031 exchange which is a bit more complicated). 

I don't understand why I might not owe any capital gains tax. My net profit will be around $50K (purchase, sale, and improvements costs included) but the tax is 15% of that, isn't it? Or is there some sort of exemption that I don't know about (that also applies to rental properties)? 

Yes we did buy it as a married couple. We don't have any other US income.

Thanks!  

Hi BiggerPockets,

My husband and I are foreign owners of a condo in Florida that we want to sell to buy other investment properties.

We didn't form a LLC at the time of buying. Now we're told that we should have in order to avoid FIRPTA (15% withholding for foreign investors) since FIRPTA doesn't apply to a domestic LLC that has multiple members (foreign or domestic).

Is it too late to create the LLC now and then transfer the property into the LLC through a quit claim deed before the sell? Or will it look suspicious to the IRS?

If it's doable will there by any consequences in terms of taxation for us, the LLC owners? As a "partnership" will each owner be taxed on future rental income? Or as spouses can we elect to file as a qualified joint venture after the sell?

The idea is to first avoid FIRPTA by being treated as partnership but then later become a "joint venture" for long term taxation purposes. 

Thanks for your help!

@Nikolas Ferreira interesting, just PM'd you with questions ;) Thanks

@Brad Singer because I'm a foreign national, not sure how it would work. Also my cash flow would be higher with two single family instead of that condo.

@Upen Patel @Andrew Postell thanks for your feedback, I'll keep you posted!

@Andrew Postell Thanks for your answer! I was told it was doable and was given those conditions to apply:

1. 35% Down Payment
2. 1, 3 & 5 year ARM's amortized over 30 years : NO prepayment penalty
3. Copy of Passport & Driving License
4. Verification of income : P60's or T4's for most recent 2 years and current wage stub. Self employed: accountant's letter verifying gross annual income for the last 2 years and year to date
5. 2 months bank statements to show funds to close plus 6 months mortgage reserves (PITI)
6. International credit report

What do you think? Is that interesting? I'm not familiar with ARM...

@Christopher Hutchins yes 2 duplexes could also be a possibility but then I'd have to deal with multiple tenants so it's a bit more risky (but probably offers higher ROI as well). I still haven't made up my mind in the "SFH vs MFH" debate. I see pros and cons for both. Do you have experience with duplexes?

@Brandon M. just PM'd you!