Hi,
When purchasing US properties (borrowing 30% from an Australian bank and the remaining 70% from a US bank), are we able to claim the interest on the US loan and depreciation on the property as a deduction? Would we use their method of depreciation or ours? Do we have to file a tax return in the US? Any help on this matter and other tax implications is greatly appreciated.
Thanks!
RobrAs you would earn income in the US then you would need to file both an annual Federal and State tax return. US interest expense, depreciation, water tax , sewer tax, city tax, school tax, pick up dog litter tax county tax and local city fines for not mowing grass, fines for not removing snow from footpath, fines for having uneven floor boards on a porch (I'm not kidding) can all be claimed…….
You can also claim your Interest expense against your foreign income here in Aust (read up on quarranteen (?spelling) rule) but it does depend on your circumstances and the structures you use both here and in the US.good luck
I agree with Tony's post above. The amount of deductions you can claim on a US tax return should mean you pay no tax. Claim on all the above and don't forget travel and meal costs if you are visiting properties. If you have a LLC in the US then you can claim business expenses also.
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