After closing, when the property taxes were due I never received any bill.

Additionally, high-income earners with modified adjusted gross income (MAGI) over $250,000 (married filing jointly) may be subject to the 3.8% Net Investment Income Tax (NIIT).For 2025, bonus depreciation is at 40%, so consider leveraging it for eligible property assets like appliances or fixtures to accelerate deductions.

As U.S. citizens residing in Europe, we are required by the local tax code to hold the property in our personal name.

Some say we have to buy the house with them or we paid too little for the property and finally after going back and forth and submitting all our paper work and paying for appraisal they now tell us they didn’t realize that the property had so many bedrooms and they said they do not loan to properties with so many bedrooms.

No state taxes, high appreciation, Economic and Job growth, Population growth, etc. 

This might make sense, but again, you are just deferring the taxes and now pushing tax from capital gains to ordinary income. 

From a tax perspective, you'll want to take what you paid for the property plus calculate the improvements you made to the property during your time of ownership.

Comps, vrbo/airbnb and finally pinterest is your friend.

Is it tax smart? 

I've finally found a property that could be a good fit for my primary residence- if I can get a good price on it.