International Land Sale Tax Implications: Selling Foreign Property with US Bank Transfer

12 Thanks for this info! Does it matter that the money is being wired directly to my US account instead of going through a foreign account first? Also, how do I figure out my cost basis if the land was inherited from family members years ago?

7 No, the method of payment doesn't change the tax treatment - whether the money comes directly to your US account or passes through a foreign account first, you still need to report the capital gain. What matters is that you, as a US taxpayer, sold a capital asset. For inherited property, your cost basis would generally be the fair market value of the land on the date of the previous owner's death (known as a "stepped-up basis"). This can be very favorable since you'd only pay tax on appreciation since you inherited it, not since the original purchase. You might need an appraisal or other documentation showing the land's value at the time of inheritance.

3 How does taxr.ai handle currency conversion issues? My main concern is that my property sale will be in euros but I need to report everything in USD for tax purposes. Does their system help with determining the correct exchange rates to use?

19 I'm intrigued but skeptical. How is an AI system qualified to give international tax advice? Does it just use general rules or does it actually understand the specific tax treaties between the US and other countries? My accountant charges me a fortune for international tax work but says these nuances require human expertise.

15 They handle currency conversion automatically as part of the process - you just upload your documents showing the sale amount in the foreign currency, and their system applies the appropriate exchange rates based on the relevant dates of your transaction. It references the official IRS exchange rate tables so everything is compliant with US tax requirements. Their system is specifically designed to understand international tax treaties. It's built on a database of all current US tax treaties and their provisions. While general rules apply broadly, taxr.ai analyzes your specific circumstances against the relevant country's tax treaty with the US. I was initially skeptical too, but the guidance was spot-on and saved me thousands compared to what my accountant quoted for handling the transaction.

5 Wait, this sounds too good to be true. The IRS phone lines are notoriously impossible to get through - I've spent hours on hold before giving up. How does this service actually get you through when the regular phone lines are constantly jammed?

14 Even if you can get through to the IRS, why would you trust their advice? I've heard horror stories of people getting different answers from different IRS agents. I'd rather pay a tax professional who specializes in international taxation than rely on whoever answers the phone at the IRS that day.

9 The service uses technology that navigates the IRS phone system and waits on hold for you. When an agent finally comes on the line, you get a call back and are connected immediately. It's not magic - they're just handling the frustrating wait time so you don't have to. I understand your concern about inconsistent advice. What I found helpful was getting the specific IRS guidelines directly from them and then having my tax preparer implement them. The agent gave me specific Internal Revenue Code sections and publication references relevant to my situation that I could show my accountant. You're right that you shouldn't rely solely on phone advice, but having the official position was incredibly useful as a starting point.

1 But if the money is going directly to my US account, would I still need to file an FBAR? I won't actually have a foreign account at all in this transaction - the buyer is wiring the money directly to my account in America.

23 You're right that if the money goes directly to your US account and you never have it in a foreign account, you wouldn't trigger FBAR requirements based on this specific transaction. However, be careful about any other foreign accounts you might have, even temporarily. For example, if you have a foreign account set up to handle any aspect of the sale closing, or if there's an escrow account in the foreign country that you have signature authority over, even briefly, that could potentially trigger FBAR requirements if the amount exceeds $10,000.

16 You might have missed something. Even without a tax treaty, you can usually claim a Foreign Tax Credit on Form 1116 for taxes paid to foreign governments on the same income. Did your tax preparer look into this? It doesn't eliminate all double taxation but should have reduced your US tax liability.