# Value of non-US property



## brown55 (Mar 25, 2016)

I inherited a property outside the US (in SouthEast Asia) some years ago and am planning to sell it. How do I calculate the initial value of the property for US tax purposes since there was no valuation done on the property at the time I inherited it? Also valuations here are very unreliable since the property is located in a very rural agricultural district. I can put in a wild guess but would not be able to substantiate it.


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## BBCWatcher (Dec 28, 2012)

Make your best, good faith effort and document it in your personal files. You could use a professional estimator's valuations, for example.

Please note that the taxable gain for real estate is usually less than the simple difference between fair market values due to allowable costs, and a Foreign Tax Credit may be possible if the foreign government taxes the gain first.


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## brown55 (Mar 25, 2016)

Thanks for the quick reply. Could you explain what you mean by "allowable costs" or point me to where I get this info.


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## BBCWatcher (Dec 28, 2012)

IRS Publication 523 has a great deal of information. So does Publication 527 if you had/have rental income.


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## brown55 (Mar 25, 2016)

Thanks again!

And another related question. If I owe substantial US tax on this transaction, but don't have enough funds in the US to cover it, what can I do? Strict local foreign exchange laws prohibit me from transferring sufficient money from here to the US.


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## BBCWatcher (Dec 28, 2012)

The IRS has a few options if you face problems paying tax owed.


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