Introduction: navigating the income, estate, and gift tax traps

 

The US has long been regarded as a safe haven for foreign investors in real estate.
Florida real estate market is flooded with inventory: foreclosures, short sales, straight sales, auctions, handyman specials, and any other creative concoction.
Combining the distressed real estate market with the weakened US dollar and a sluggish domestic economy, foreign investors are flocking to get their piece of the American pie.

Although most of the multi-million dollar investors are sufficiently savvy to engage a tax attorney for the transaction, in order to properly structure their investment, most individual investors, those looking for a winter condo or just a couple of rental properties, are oftentimes unaware of the tax traps surrounding what otherwise appears to be a perfect investment.

Please note that this article is merely a simplified introduction to an extremely complex area of law, it attempts to explain the common pitfalls foreign investors in U.S. real property face and the techniques every advisor should consider when engaged by such clients.
Prior to engaging in any of the covered techniques, be sure to understand fully all of the implications associated with their implementation, and always consult a specialized attorney.