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Is a nonresident alien taxable on gain from a house sale (personal residence when he lived in Arizona ?

Tex Thex CPA
Level 1
Does the Sec 121 exclusion apply ?
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3 Replies 3
Level 14

Maybe, depending on the facts and circumstances.  But Section 121 does not apply to a personal residence.  It must be the primary residence.  So, why do you think this nonresident was a resident, for home ownership purposes?  

Level 15

Sounds like the home was the NRA's primary resident prior to moving away from the US.

@Tex Thex CPA There's nothing that precludes the NRA from claiming §121 so long as all the conditions are met like Bob said.  I am just surprised that this is brought up only now because your client would normally have been subject to FIRPTA at the time of sale (although limited exceptions may apply) and any application for withholding reduction/exemption must be submitted to the IRS within a narrow time frame.

Still an AllStar
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Level 14

I don't see anything about moving away from the U.S.  Just as likely, bought another house in a different neighborhood or city.  

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