Income tax related to properties in China

[Joanne]

There is an apartment in China under my name. As I was informed in a previous thread that I don't have to pay property tax for it. However, if in future the apartment is sold, do we have to pay income tax? What if it is sold and is replaced by another property, i.e., no cash gain?

 

I think a lot of the Chinese SOs own apartments in China. This could be a common concern. I wonder if anyone has taken a close look at the issue. Thanks for your input!

Edited April 18, 2006 by Joanne (see edit history)

[Randy W]

For buying and selling property, you can avoid paying income tax on the increase in value of your residence by putting it all into your next residence. This would not apply to second or rental property.

 

There is also a one-time exclusion, where you can sell your home and keep the money, but this is at (I believe) age 65 only (or somewhere in your 60's - I forget)

[Joanne]

For buying and selling property, you can avoid paying income tax on the increase in value of your residence by putting it all into your next residence. This would not apply to second or rental property.

 

There is also a one-time exclusion, where you can sell your home and keep the money, but this is at (I believe) age 65 only (or somewhere in your 60's - I forget)

207909[/snapback]

Thanks, Randy!

 

Does this mean that if in future we sell this apartment and within a certain time frame we purchase a house in US which cost more, we don't need to pay income tax on that increase of value (between the selling and purchasing price of the apartment in China)?

[Randy W]

There is a time limit (maybe a year?). Say, you move out of one house, but before buying another, you rent a place. Then, if you buy a new home within that time limit, the exemption applies.

 

I don't know if this applies to the property in China, though. Good luck! You might be better off just not reporting it.

[inxy]

You know that if you don't say - they don't know.