Are non-citizens allowed to purchase real estate in the US?
If they can. What type of documentation do they need? Will the homeowner insurance and taxes be different for a foreigner then a citizen? What else should they prepare before purchasing? And, anything else they need to watch out for? Will really appreciated if you can give me as much information as possible.
Yes, a non-citizen can purchase US real estate. Yet, regardless of what kind of real estate you are interested in, there are a multitude of tax ramifications, financing options and legal requirements to be deatl with.
As for property taxes and insurance they should be the same regardless if you are a US citizen or not. As far as other tax consequences, things are different. First off, you would need an Individual Taxpayer Identification Number (TIN) which you will use with all your tax transactions. Your investment in real estates can be treated as investment income which can either be fixed or a periodic income, both of which are taxable. This tax however does not apply though to all foreign investors. Rates would vary depending on the tax entity that the foreign investor opted for; for instance, a corporation would be taxed differently than an individual.
There are also state taxes on real estate and other like matters which need to be considered. Another important thing to remember when you're buying real estate is financing. In today's economic climate, financing can be difficult, especially for a foreign investor.
If you are considering buying a property in the US, you should strongly consider hiring a real estate attorney to assist you through the purchase process. They can review the sales contract, check on the title and related documents , as well as look over your mortgage financing documents, if any. Additionally, they can make the necessary adjustments relating to various expenses involved in the purchase and help with tax questions (or at least recommend an accountant who can). You can check on-line and look for a lawyer working within the state where you are considering purchasing a property. If you need assistance with this, you can refer to www.AttorneyPages.com .