Transferring cash to the US for green card resident

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neurosphere
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Transferring cash to the US for green card resident

Post by neurosphere »

I have a friend here in the US who has a green card, native country is Brasil. She recently inherited a piece of land when her parents died. It is owned together with two other family members. The two other family members want to immediately sell the property and take the cash. From the very brief summary I heard about the family situation, it sounds like selling the property (a cattle ranch) is a good idea (rather than try to run a business from afar none of them have any experience with).

My friend will be living in the US for at least 4 more years. After that, she is likely to stay, but that has yet to be decided.

My (hopefully simple question) is, assuming the land gets sold, are there any particular laws/rules/regulations which she should investigate which would limit her ability to transfer a large sum of cash to an account in her name in the US? The amount could be anywhere from $100,000 to $1,000,000.

Also, I assume that any profits/gains from the property is taxable income to her in the US (subject to the normal laws of foreign income with foreign tax credits and modified by any treaties).

Of course she will be advised to consult legal/tax professionals (both in south america and here) as she goes about selling the property, but basically I'm just trying to investigate if there will be any potential hurdles to her transferring a big lump of cash to banking/investment accounts in the US, which she now considers her home.

Thanks, NS
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes" (even in taxable accounts).
Cyclone

Re: Transferring cash to the US for green card resident

Post by Cyclone »

I assume you are talking about a wire transfer, and not actual "cash"? I don't know of any problem offhand. If she pays income tax in the US, this might be taxable.
livesoft
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Re: Transferring cash to the US for green card resident

Post by livesoft »

Some countries have laws against removing large amounts of money from the country. What are the laws of Brazil?

As far as I know, there are no special US laws about transferring money to the US. Presumably though the money will first go into an account for her in Brazil, so she will have to declare that account to the US Treasury: http://www.irs.gov/Businesses/Small-Bus ... nts-(FBAR)
and
http://www.nolo.com/legal-encyclopedia/ ... -fbar.html
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bsteiner
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Re: Transferring cash to the US for green card resident

Post by bsteiner »

Inherited property generally gets a basis step-up at death for U.S. income tax purposes. I don't know whether that's the case in Brazil.

Since the amount could be substantial, her parents might have provided for her in trust rather than outright, to keep her inheritance out of her estate, and to protect it against her creditors and spouses. I don't know whether that's practical for property in Brazil.

Someone considering coming to the U.S. might also want to consider pre-immigration planning.
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neurosphere
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Re: Transferring cash to the US for green card resident

Post by neurosphere »

Thanks for the answers everyone. I think my basic question has been answered.

Here is some clarifications of the situation based on your responses, in case anyone is interested.

-- Yes, I was asking about a wire transfer for the "cash", and not a suitcase full of bills. :D
-- Friend is already in US with green card.
-- The property was put in her name prior to her parents' death, and whether it was done so as a trust or in some other way is unknown.
-- Complicating matters is that the three owners are 1) my friend, an incredibly capable and smart woman but with zero knowledge of tax/financial matters, and near zero time to deal with this (she is a medical resident), 2) her brother, who is an alcoholic with a spending problem and 3) her aunt, who is a nun in a convent of sorts, and doesn't want any of the money which results from the sale. Also, each of them own the property as adjacent individual parcels, which are worth much more if sold together rather then sold individually. The brother is threatening to go ahead and sell his middle parcel on his own the other two don't agree to a joint sale immediately, which would not be a good idea overall for any of them.
-- A potential sale is in the works, it seems, and my friend can only trust that the aunt (who is handling the sale) is getting good advice. The current plan calls for payments to be made in quarterly installments over 3 years (with some of the payments being in the form of cattle :shock: ).

Anyway, that's all more detail than necessary for the basic question. But it seems that upon sale, any taxes due in Brazil and/or the US must be paid, or course, and accounts in Brazil with $10,000+ dollars declared in the US. But other than that, any funds in a Brazil account can be wired to a US account without any particular tax/restriction. Although I assume if the amount is large enough it will get reported to the IRS and/or other agency and their may be some special forms or reporting requirements so that the government can ensure the funds are "legal".

Thanks!
NS
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes" (even in taxable accounts).
obgraham
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Re: Transferring cash to the US for green card resident

Post by obgraham »

What's the big rush?

Just see the transaction through under Brazilian procedures and dealing with the family turmoil, put the proceeds into an account at a reliable Brazilian bank.

After everything settles, then work out the best way to move some or all of it to the US.

I was a green card holder when my mother passed away in Canada. I had no problem transferring the funds to the US after her will settled. There no tax implications at all.
Cyclone

Re: Transferring cash to the US for green card resident

Post by Cyclone »

I think you may be getting confused. CURRENCY (green pieces of paper) transactions over $10,000 into or out of a US bank account are reported. Wire transfers are not. Is that your worry?
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neurosphere
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Re: Transferring cash to the US for green card resident

Post by neurosphere »

obgraham wrote:What's the big rush?
Oh, no particular rush. I just wanted to reassure my friend that when the dust finally settles with this property, she would have access to the funds either here or Brazil as needed, without any hidden "gothchas" such as administrative/regulatory delays, etc.
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes" (even in taxable accounts).
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neurosphere
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Re: Transferring cash to the US for green card resident

Post by neurosphere »

Cyclone wrote:I think you may be getting confused. CURRENCY (green pieces of paper) transactions over $10,000 into or out of a US bank account are reported. Wire transfers are not. Is that your worry?
No. I realize that paper money transactions over $10,000 are reportable. The $10,000 I was referring to was simply the IRS regulations which state that any foreign account with over $10,000 in it was required to be declared to the IRS (the FBAR rules that livesoft mentioned).
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes" (even in taxable accounts).
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