|
Important
|
For information call now:
(347) 989-4566
|
|
|
Additional information
|
Internal Revenue Service
Austin Service Center
ITIN Operation
P.O. Box 149342
Austin, TX 78714-9342
IN
1-800-829-1040
|
|
|
Real Property Gain or Loss
Gains and losses from the sale or exchange of U.S. real property interests
(whether or not they are capital assets) are taxed as if you are engaged in a
trade or business in the United States. You must treat the gain or loss as
effectively connected with that trade or business.
U.S. real property interest
This is any interest in real property located in the United States or the U.S.
Virgin Islands or any interest (other than as a creditor) in a domestic
corporation that is a
U.S. real property holding corporation. Real property
includes the following.
1. Land and unsevered natural products of the land, such as
growing crops and timber, and mines, wells, and other natural deposits.
2. Improvements on land, including buildings, other permanent
structures, and their structural components.
3. Personal property associated with the use of real property,
such as equipment used in farming, mining, forestry, or construction or property
used in lodging facilities or rented office space, unless the personal property
is:
a. Disposed of more than one year before or after the
disposition of the real property, or
b. Separately sold to persons unrelated either to the seller or
to the buyer of the real property.
Special rules apply to
qualified investment entities (QIE).
Domestically controlled qualified investment entitiesThe sale of an interest in a domestically controlled QIE is not the sale of a
U.S. real property interest. The entity is domestically controlled if at all
times during the testing period less than 50% in value of its stock was held,
directly or indirectly, by foreign persons. The testing period is the shorter of
(a) the 5-year period ending on the date of disposition, or (b) the period
during which the entity was in existence.
If you dispose of an interest in a domestically controlled QIE in an applicable
wash sale transaction, special rules apply. An applicable wash sale transaction
is one in which you:
1. Dispose of an interest in the domestically controlled QIE
during the 30-day period before the ex-dividend date of a distribution that you
would (but for the disposition) have treated as gain from the sale or exchange
of a U.S. real property interest, and
2. Acquire, or enter into a contract or option to acquire, a
substantially identical interest in that entity during the 61-day period that
began on the first day of the 30-day period.
If this occurs, you are treated as having gain from the sale or exchange of a
U.S. real property interest. This also applies to any substitute dividend
payment.
|
|
|
