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Abstract: 

Many foreigners purchase a personal residence as an investment or a safe haven from their own countries. In the past, such purchasers assumed they would not be liable for U.S. income taxes. That is not a safe assumption in light of the Tax Court’s 2012 ruling in Parker. The author reviews the tax planning considerations and suggests that the common thinking about how to structure the purchase of a home in the U.S. needs to be reviewed and reconsidered.

Keywords: purchase of U.S. residence; tax structuring; Green Card test; substantial presence test; closer connection test; G.D. Parker, Inc. v. Commissioner; Bigio v. Commissioner

Affiliations:  1: Osborne & Osborne, PA.