TRAINING: Foreign Investors: What You Need to Know (VIDEO)

Foreign Investors: What You Need to Know

• If you have an investor from overseas, they are subject to withholding tax of the price of the home when they sell.
• Before buying or selling real estate, the overseas client will need to be aware of:
  • Need to obtain ITIN number (Tax ID Number)
  • Qualified accountant (can process the application based on what the tax liability is)
  • Client needs a passport verified (certified copy)
  • Client will need to repeat this process when they want to buy income property
  • Client will have to pay taxes on the income for the rent
  • ITIN numbers expire after 2 years if it hasn’t been active
  • Refer the client to legal/tax representative to decide on how to hold title 
    • Do not advise your client on how to hold title because that is legal advice you are not allowed to give.
  • When the client wants to open an irrevocable trust, they will need to speak w/ an attorney

• Property Management- not permitted under United Real Estate Los Angeles
  • If the agent is “picking up the rent” then they are the “Property Managers”
  • If proper procedures are not in place, then the agent/ “Property Manager” can and will be held responsible for the taxes owed on the property that were supposed to be in escrow withholding