How to sell housing and re-register real estate in your home country while in the USA

Many immigrants in America face the problem of how to dispose of real estate in their home country. There are many reasons for this: one left to escape military action, another to escape the risk of conscription, a third received an unexpected inheritance in the form of his great-grandmother's apartment. Each of us has his own path, but we all end up in a similar situation, and I will not be surprised at all that many, having read this article, will recognize themselves in it.

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Most appeals to me comes from citizens of Russia and Ukraine who by the will of fate found themselves in America. Many of them, leaving in a hurry, quickly drew up powers of attorney for their close and not so close relatives, having provided in these powers of attorney broad powers, including the sale of real estate belonging to them.

This is mistake #1: never and to no one should you issue a power of attorney "for future use" and just in case. If you do not intend to sell the apartment right now, then you do not need to issue a power of attorney for these purposes. The most reliable way to protect yourself from fraud is not to hand out powers left and right. Even if you are going abroad, know that any power of attorney can be issued in absolutely any jurisdiction at the time you need it.

To issue a power of attorney in any country, you need a little:

• your own passport;
• passport details of the authorized person;
• contact a professional lawyer who has the necessary education and experience.

The last condition is extremely important, because homemade powers of attorney are usually not accepted. This has given rise to a myth: in order for a foreign power of attorney to be accepted in Russia or Ukraine, it must be certified anywhere except at the consulate. This is not true. Any professionally executed power of attorney will be accepted in any jurisdiction.

How to Sell an Apartment in Russia While in the USA

When preparing for a transaction involving Russian real estate, you must first take into account the tax aspect.

1. If you received an apartment through privatization, you will not be able to sell it immediately without losses. In the first three years, the tax for non-residents when selling an apartment received through privatization will be 30%. You may ask what tax will have to be paid after three years. None. After three years of owning such an apartment, the tax will be zero.

2. If you received an apartment by inheritance, then the period of ownership before it can be sold without loss will be from three to five years, depending on the degree of kinship with the testator.

3. If you received an apartment as a gift, then for the subsequent sale it is also necessary to wait a period of three to five years, depending on the degree of kinship with the donor.

But that's not all: if you are about to receive real estate in Russia as a gift, stop, think, consult a lawyer and tax specialist. You will be very surprised, but when you accept property as a gift, you receive income, and you need to pay tax on the income: 13% for tax residents and 30% for non-residents. The exception is legal spouses and close relatives, their gifts are not subject to tax.

On the subject: Wills, inheritance and taxes: how to solve these problems if you live abroad

But if you still happen to receive a gift without consulting a specialist in advance and you are faced with the need to pay tax on the gift received, then remember: some amounts are deductible from the taxable base: for example, money spent before receiving the gift. There are many nuances regarding gifts, so before giving a gift or even more so accepting property as a gift, consult a specialist.

4. If you received real estate as an inheritance, then the possibility of subsequent sale of this property also depends on the degree of your relationship with the testator. The minimum period of ownership of real estate received by inheritance is 3 years, the maximum is 5 years. During this time, you will not be able to dispose of your apartment or house, because a tax non-resident will have to pay a fee of 30%.

How to sell an apartment in Ukraine while in the USA

Ukraine has its own peculiarities. Thus, when entering into an inheritance, a tax non-resident pays 19,5% to the treasury. If you have already fallen into the category of tax non-residents, then you can avoid paying this fee in only one way - to refuse the inheritance. You can refuse the inheritance in favor of another specific heir or irrespectively, which means in favor of all, that is, the share of the inheritance due to you will be proportionally divided between the other heirs.

Thus, by refusing the inheritance in favor of heirs living in Ukraine, neither you nor they will pay a high tax. However, if there are no such relatives, and you want to receive the inheritance, then you will have to pay. There is also a positive aspect here: having paid the tax once, you will not have to pay it again when subsequently selling the inherited real estate. You will be able to sell your apartment without losses the very next day after receiving the certificate of inheritance.

Our clients often ask who is a tax resident or non-resident. Contrary to popular belief, this has nothing to do with citizenship: you can be a citizen of your country and not be a resident; you can be a foreign citizen and still be a resident.

You are a tax resident of the country where your center of vital interests is located, the country with which you have the closest personal and economic ties. The center of vital interests is determined primarily by the length of residence in a given jurisdiction. As a general rule, to be considered a tax resident of a given country, you must reside in that country for at least 183 days during a calendar year.

Very often, when alienating real estate, whether by gift or purchase/sale, the question of marital rights arises. The fact is that, in accordance with the current legislation of both Russia and Ukraine, property acquired during marriage through compensated transactions is the common property of the spouses, regardless of which spouse is the owner. When alienating such property, the written consent of the other spouse is required. In such cases, marital consent is also drawn up along with the power of attorney.

In cases where the owners of real estate, along with adult family members, are their minor children, the alienation of such real estate requires permission from the guardianship and trusteeship authority.

Obtaining permission from the guardianship and trusteeship authority is a subject for a separate conversation, but in short, such consent can usually only be obtained if equivalent housing is purchased in the child's name (including abroad, i.e. in the USA). In most cases, to dispose of the property of a minor, the child's parents must personally apply to the guardianship and trusteeship authority.

However, if you want to buy property in the name of a child, and not sell it, then there are no special requirements for the purchase, except that a child under 14 years of age is represented by his legal representatives (parents), and a child between 14 and 18 years of age is represented personally on his own behalf, but with the consent of his mother or father. It is precisely "or" - the consent of one of the parents is more than enough for these purposes.

Minor complications

And finally, the cherry on the cake – deregistration. It is very difficult, although not prohibited by law, to sell an apartment in which people are registered. Especially children. Contrary to one of the most widespread misconceptions, it is possible to deregister a child. And you do not need the consent of the guardianship and trusteeship authority for this. You do not need to go anywhere (meaning, to your homeland) and especially take your child there. And there is no need to even contact the embassy or consulate. You can deregister remotely, for this you just need to fall into professional hands who will prepare the correct documents for you, submit these documents to the authorities in the Ministry of Internal Affairs and get the necessary result for you.

But even if you don't trust anyone and think it's completely impossible (yes, I have many doubting clients), even in this case you can sell your apartment. Simply selling an apartment with people registered in it, you are guaranteed to lose in price, a significantly larger amount than you spend on a professional lawyer who will remove you from the registration record.

You may be interested in: top New York news, stories of our immigrants and helpful tips about life in the Big Apple - read it all on ForumDaily New Y

Many Russian pensioners are worried that if they deregister in Russia, they will lose their pension. This statement is also one of many misconceptions: if you are a citizen of the Russian Federation, have reached the appropriate age and have the appropriate work experience, then you have the right to a pension, and no one and nothing will take this right away from you, even if you are left without a place of residence in Russia.

Many pensioners who do not have a place of residence in the Russian Federation successfully receive their pensions. What is needed for this? A valid Russian passport and (in some cases) a certificate of survival, which Our New York office also draws up and submits it to the pension/social funds for you. But we'll talk about that next time.

Read also on ForumDaily:

How to issue a power of attorney abroad: advice from an experienced notary

How to receive a Russian pension in America, and why you should not save this money in Sberbank accounts

Bulgakov's stories about death and inheritance from a Russian-speaking lawyer in the USA

Here's how to get military service exemptions to live and work in the U.S.

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