In a recent poston the “IRS Boogieman”, It seems I stirred the pot. It is not my intention to frighten people away from buying American property. My intent is to get people to think about doing some additional research before they buy property south of the border.
The IRS requirements if you buy in the U.S. are simple. They require lifetime filing of returns even if you sell the property. Failure to do so may incur penalties that may add up over time, and long after you’ve sold your property it may come back to bite you or your estate. My understanding is that you can do a zero filing and that will suffice, but I’d recommend you get expert advice on that.
On a side note note a few things my American colleagues have said have made me think that while right now they appreciate the sales generated by Canadian and other foreign investors, there may come a day when that ownership is resented. Remember laws change over time and someday the political landscape south of the border could lead to changes to tax and other laws making foreign ownership of property a little more onerous still. It is unlikely that the current Canadian invasion will be looked upon as favorably if affordability in those markets deteriorates, and investment properties that are used only sporadically become blights on the neighborhood.
