Articles

When Does a “Guest” become a “Tenant?”

Popular vacation rental websites like to use the term “Host” in place of owner and “Guest” instead of tenant.

Host & guest, when used in the realm of vacation rentals, which are 29 days or less, is a fair term. We wonder when does a guest become a tenant?

The Arizona Residential Landlord & Tenant Act is excluded in transient occupancy in a hotel, motel or recreational lodging. According to the Arizona Department of Revenue, any occupancy greater than 29 days falls under the business code for residential rentals, even when offered through a website. That has no bearing.

In Arizona, this is detailed in the Arizona Revised Statute (ARS) 32-2121, which provides an exemption to licensing requirements for rental activity less than 30 days. ALL OTHER RENTAL ACTIVITY REQUIRES A PERSON TO HOLD A LICENSE [Read More]

June 20th, 2019|Articles|

Taxation of Non Resident Aliens

An alien is any individual who is not a U.S. citizen or U.S. national. A nonresident alien is an alien who has not passed the green card test or the substantial presence test.

A.  Who Must File

If you are any of the following, you must file a return:

  1. A nonresident alien individual engaged or considered to be engaged in a trade or business in the United States during the year.
  2. A nonresident alien individual who is not engaged in a trade or business in the United States and has U.S. income on which the tax liability was not satisfied by the withholding of tax at the [Read More]
May 10th, 2019|Articles|

Withholding on California Real Estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

What is Withholding?

Real estate withholding is a prepayment of state income taxes for sellers of California real property. Real estate withholding is not an additional tax on the sale of real estate but a prepayment of the income tax due on the gain from the sale of real property. Withholding is required on sales or transfers of California real property when the sales price exceeds $100,000 and does not qualify for an exemption.

In California all transferees (buyers) are required to withhold 3 1/3% of the total sales price unless exempt by reasons listed below. To document the exemption, the real estate escrow person (REEP) obtains a completed and signed under penalty of perjury (FTB from 593-C). Below are the exemptions listed on the FTB form 593C which would determine whether you qualify for a full or partial withholding exemption.

Certifications which fully exempt [Read More]

January 17th, 2019|Articles|