Foreign real estate: new real estate tax IMU
Mario Monti’s new italian government has adopted a new real estate tax called „IMU“, valid also for foreign real estate. Hence 0,76% of the value stated in the act of sale has to be paid to the italian state. In case no value is stated in the act of sale the current market value will come into consideration. To avoid double taxation in the owner’s country a tax credit will be recognized to the owner.
The purchase of real estate in the State of New York
In the State of New York the sale and purchase of real estate goes step by step. Signing the Contract of sale is the first step and can be compared to the act called in Italy “compromesso”. Generally the buyer pays a hansel of about 10% of the price into a Escrow account, named on an attorney chosen by the buyer.
Furthermore the seller has to hand over to the buyer a Title insurance. The Title insurance guarantees the buyer on the one hand that the object of purchase is free of mortgages and other impositions, on the other hand, that in case of seller’s non-fulfilment the price is secure. The Title of insurance has a cost of about 0,5% to 0,75% of the price of sale. The entire price will be transferred to the seller in the moment of signature of the Transfer act of deed, which can be compared to the act called in Italy “rogito”. This is the moment when property passes from the seller to the buyer.
The buyer has to pay the following taxes: 1) transfer tax (can be compared to the italian “imposta di registro”); 2) mansion tax (is only due if the object of purchase exceeds the value of 1 mio$); 3) real estate tax (can be compared to the Italian “ICI”).
The budget act 2010 extended the deadline for revaluation measures
The initial point was the taxation determined for IRPEF-payers concerning the appreciation of estates and those shareholdings, which are not quoted on the stock exchange ore other regulated markets.
This preferential treatment is only related to simple companies, natural persons and non-commercial corporations. Prerequisite is, that the goods to revaluate are not part of an enterprising activity.
The revaluation for agricultural areas is taxable, provided the owner has retailed the area within five years and the area has not been donated or bequeathed. In case of building areas the appreciation is taxable without exceptions.
Beneficiaries can choose either to add the appreciation to other incomes regarding the period when it was realized or to pay the substitute tax of 20% when the deed is signed.
In order to determine the appreciation a report of a sworn expert is needed. The tax rate applied for building and agricultural areas as well as for qualified shareholdings is 4% of the appraised value, for not qualified shareholdings 2%.
Taxpayers can disburse the entire substitute tax within 31st October 2010 or divide it in two or three rates (to disburse always within 31st October of the following years). In case of rate paying an annual interest loan of 3% is due.