mistake #1- Working with an Incompetent or Ignorant Real Estate Agent.
Using an specialist is priceless, dealing with amateurs and ignorant individuals is always costly and frustrating. Medical doctors, attorneys and accountants become specialists by studying and focusing on the nuances of a particular field to attain mastery. A competent real estate agent should make the foreign investor aware of the multiple p
issues ( immigration, taxation of income earned, capital gains, gift and death taxes, inherance/estate matters, financing strategies) which must be addressed prior to spending a single dollar.
As an investor you must have “road map” of your investment objectives and a competent- well trained agent should be able to assist you in “navigating” pass through all of the aforementioned issues. One way to assess the competency and experience of an agent is to ask some simple questions and evaluate the certainty in the response. For example.
A) If I buy a property in the USA-would that help me qualify to immigrate with my family? The proper answer is No. Buying a condominium in Florida does not give the investor the right to immigrate. The investor and the family may come “to visit ” their investment but it depends on the type of Visa that the investor is holding or is entitled to have. Citizens of countries which have Visa-Waiver agreement with the USA may visit the country without a visa for up to 90 days, at a time. For additional reference and list of Visa-Waiver countries Click(linkage to Homeland.
An alternative answer, used by many attorneys, may be.
It depends, some investors may set up an entity for the specific purpose of buying, upgrading, leasing and selling real estate and they may receive a visa which permits them immigrate as investors
B) The investor may present the following scenario:
“We have businesses in Spain, factories in other parts of the world and investment income from different sources, we would like to invest in the USA and get a “Green Card”.
What do you think? could we do that? The investor asks.
A competent agent should tell the investor that by obtaining a “Green Card” The investor and the family will be subjected to pay income taxes on your world-wide income, same as a US citizen.
For a high net worth investor having a “green card” may not be the best alternative. A competent agent should refer the investor to a financial planner or an international attorney to create the best financial structures. Many ignorant agents think that every foreign investor wants to have a “green card”. A “Green Card” creates a big Tax Liability.
C) “We are retired and would like to spend six months of the year in Florida, we have income to support ourselves. We have Tourist visas for 180 days. Can we buy something which permit us to enjoy our retirement days in our second home?
Unlike many countries United States does not have Retirees Visas.
The answer is No. While the visa is for 180 days , once the investor spends more than 31 days he/she may be subject to the “Substantial Presence Test”
May I Suggest that you should ask the agent to explain what is the significance of the Substantial Presence Test and how does it affects you?
If you are intrigued by some of the issues presented in this post we have access to team of highly competent attorneys that can provide the appropriate counseling and answer all your questions and prevent you from making a costly mistake.