Hi cj2005,
INS and the IRS have different requirements to determine residency.
The IRS considers you a U.S. resident if you've resided in the U.S.
for at least 183 days (see the first link to see if you meet the
"substantial presence test"). That said, in order to claim an
exclusion on your gain from the sale of the house, you would have to
have lived in the house for two years. Therefore, assuming that you
are a U.S. resident for tax purposes, you will have to pay Capital
Gains Tax unless the house was your main home for two years, in which
case you will be able to claim an exclusion of up to $250,000.
Topic 851 - Resident and Non?Resident Aliens
You are considered a resident alien if you met one of two tests for
the calendar year.
"The second test is the "substantial presence test." To meet this
test, you must have been physically present in the United States on at
least 31 days during the current year, and 183 days during the 3 year
period that includes the current year and the 2 years immediately
before."
http://www.irs.gov/taxtopics/tc851.html
Publication 523 (2004), Selling Your Home:
Maximum Exclusion
"You can exclude up to $250,000 of the gain on the sale of your main
home if all of the following are true.
1. You meet the ownership test.
2. You meet the use test.
3. During the 2-year period ending on the date of the sale, you did
not exclude gain from the sale of another home."
Ownership and Use Tests
"To claim the exclusion, you must meet the ownership and use tests.
This means that during the 5-year period ending on the date of the
sale, you must have:
1. Owned the home for at least 2 years (the ownership test), and
2. Lived in the home as your main home for at least 2 years (the use test)."
http://www.irs.gov/publications/p523/ar02.html
MAIN HOME
"Usually, the home you live in most of the time is your main home. It
can be a houseboat, a mobile home, a cooperative apartment, or a
condominium.
To qualify under the new, post-May-6-1997 exclusion rules, you must
generally have owned and used the property as your main home for at
least two years during the five-year period ending on the date of
sale..."
"If you have more than one home, only the sale of your main home
qualifies for excluding the gain. If you have two homes and live in
both of them, your main home is the one you live in most of the time."
Example.
"You own and live in a house in town. You also own beach property,
which you use in the summer months. The town property is your main
home; the beach property is not."
Example.
"You own a house, but you live in another house that you rent. The
rented home is your main home."
TIP:
"Where a second residence has soared in value and you want to sell,
some tax advisors have suggested moving to the second residence for
the required period to qualify for exclusion on its sale. If this is
your situation, professional guidance is suggested."
http://www.myaccountingportal.com/fso/TS/fg/fg-home_tax.html
If you did not live in the house, I'm afraid you will not be able to
claim the exclusion.
I'm sorry for the bad news. If you have any questions, please post a
clarification request *before* closing/rating my answer and I'll be
happy to reply.
Thank you,
hummer
I searched the IRS website for relevant information. |
