Thursday, November 9, 2017

All About Real Property Taxes in Mexico

Nick Fong a well known and respected real estate brokeri in Los Cabos has written an excellent article  on everything you need to know about  Property Taxes in Mexico (click on link )

Friday, October 20, 2017

IRS Announces 2018 Tax Brackets, Standard Deduction Amounts, And More

The article linked below from Forbes on the 2017 tax brackets, deductions, etc.  A lot of this may change if Congress succeeds in changing the tax laws this year.  Congresses current plan would generally provide large breaks for the wealthy, small breaks for the middle class and little for the poor. Read the article here

Thursday, October 19, 2017

Tax Consequences of Renting Out Your Casa in Mexico


Rental of your property in Mexico part time can result in the following US tax consequences on your US tax return:


  1. If you rent it for fewer than 14 days per year you do not have to report it on your US tax return.  You still for US tax purposes treat it the same as a personal residence or second home and within the limits prescribed for those types of property get to deduct your mortgage interest and property taxes.
  2. If you personal use your Mexico property more than 14 days or 10% of the number of days it is rented, for US tax purposes it is still considered your personal residence or second home.  You can deduct expenses allocable to the rental up to the amount of rental income, but you cannot deduct losses.
  3. When you rent out your house more than 14 days you become a landlord in the eyes of the IRS. You must report your rental income but can deduct expenses up to the limit previously stated.
  4. If you limit your personal use to 14 days or 10% of the time the property is rented, it is considered a business. You can deduct all of your expenses, depreciate the property on your tax return, if if that results in a net loss may be able to deduct up to $25,000 of such a loss against your other income (subject to limits measured by the amount of your other income).
  5. If you do have to pay taxes on the rental income in Mexico, you can either deduct those taxes or claim as a tax credit against the tax shown due for the rental on your US federal tax return.  Most US states do not allow this tax credit.


Remember, that your rental income may also be subject to taxation by the Mexico tax authorities, Failure to pay the Mexico taxes can have severe consequences.  Go http://rentaltaxmexico.com/ to learn more about that tax  obligation. The Hacienda has been known to look on the internet to find local Mexican properties that are being rented out for which no Mexican taxes are being paid.


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Don D. Nelson is a US Tax Attorney who has been assisting clients in Baja with their US International and Expatriate tax matters for over 18 years.  He lives in Los Cabos part of the time.   He can be reached by email at ddnelson@gmail.com and by US phone at 949-480-1235. Learn more at his website at www.taxmeless.com

Wednesday, September 20, 2017

KEY REASONS PEOPLE ARE RETIRING AND MOVING TO MEXICO FROM USA

Read the following article on the key reasons people are retiring or moving to Mexico to conduct their businesse while living a great lifestyle:  https://amarfriendsfoundation.wordpress.com/2016/07/04/key-reasons-why-people-are-relocating-to-mexico/

If you are thinking about such a move and wish to know more about the US tax consequences and the Mexican tax consequences, email us at ddnelson@gmail.com.  We have hundreds of clients in Mexico and spend six months a year there. We can give you the information you need.

Tuesday, September 5, 2017

Mexico Enforcing 6 Month Tourist Visas and Payment of Taxes By Gringos Living and Working in Mexico

Mexico is now getting tough on 6 month tourist visas and collecting taxes from gringos renting property in Mexico and earning money while living in Mexico.  See more at the link to the article on Yucalandia.

https://yucalandia.com/2017/09/02/inm-continues-to-increase-enforcement-of-restrictions-on-6-month-tourist-visas/

If you are renting property in Mexico and not paying taxes read the rules http://rentaltaxmexico.com/

If you are working and earning money in Mexico read the tax rules at: https://home.kpmg.com/xx/en/home/insights/2011/12/mexico-income-tax.html

If you need help with your US taxes while in Mexico contact us at ddnelson@gmail.com   Remember, you must still file a US tax return on your worldwide income even though you are paying taxes in Mexico. You do get exclusions and credits for taxes you already paid in Mexico. The statute of limitations never expires for the IRS to assess and collect taxes against your worldwide income if you fail to file a US tax return when you are required to file.

Saturday, July 15, 2017

Best Places to Retire Abroad...Mexico

Read about Chuck Bolotins current travels through Mexico with his wife and 2 dogs. Covers place@, experiences, travels and people other than taxes .  READ LINK BELOW

https://bestplacesintheworldtoretire.com/profile/2224-best-places-writer

Wednesday, July 12, 2017

Legal Aspects of Establishing a Business in Mexico

When you start a business in Mexico, you have decide whether you incorporate; what type of corporation or set up a branch of your US corporation.  If you are a permanent resident you can also set up a sole proprietorship. Below is a great article of the subject written in 2017 (so it is current).


If you wish to review the US tax and legal ramifications of doing business in Mexico with a US attorney who has hundred of clients in Mexico and has been assisting them for over 25 years you should email Don D. Nelson , Attorney at Law at ddnelson@gmail.com     The proper legal and tax guidance will save you not only money but untold problems.