What is the name of your state? New York
I'm US citizen. Selling my apartment oversease. Planning to give all the proceeds to my father - resident of that country who lives there - as a gift.
Do I have to pay taxes in the US from the capital gain from the apartment sale (there is no gain, really, after I give the money away)
Thanks!
You have two issues here.
1) Capital gains tax on the gain on the sale.
2) Gift tax issues.
US citizens are taxed on their world wide income. So yes, if there is a capital gain on the sale of the apartment, then you will be subject to capital gains tax . The sales price, minus your original purchase price, minus cost of improvements, minus selling costs, is your capital gain (or loss). If you lived in the home for two of the last 5 years, you can exclude from taxes, 250,000 in capital gain. It doesn't matter if you give the money to your father or not, you are still subject to capital gains tax if there is a gain. You will however get credit for any taxes you must pay in the other country.
If you then give the proceeds of the sale to your father, and those proceeds are greater than 12,000, then you must file a gift tax return. There will be no gift taxes to pay, unless you have exceeded your lifetime exclusion of 1 million dollars for gifting, but you must still file the return.
It might be simpler to gift the actual apartment to your father (if that is possible in the other country) and let him sell it. You would still need to file a gift tax return however, for the fair market value of the apartment.....unless it was your residence for two of the last 5 years.
