US and Mexico Taxes for Americans Living in Mexico. If you have a fideicomiso, Mexican corporation, a foreign bank account in Mexico, or live in Mexico this blog will have data you need about the required forms 5471, 3520, 3520A, FBAR 114, 926, 8865, 2555, 1116, etc., which you may have to file if you live and work in Mexico.
IF YOU OR YOUR FOREIGN CLIENTS OWN RENTAL PROPERTY ANYWHERE IN MEXICO - THESE MEXICAN TAXES MUST BE PAID
Mexico Income Taxes
Mexico Value Added Taxes – IVA (16%)*
SI QUIERE LEER ESTO EN ESPANOL, FAVOR DE VER EL ANEXO.
Many nonresidents of Mexico have never paid any taxes on their rental income from properties they own in Mexico. This is against Mexican tax law. The Mexico tax code clearly states that these Mexican taxes must be paid on rental income from apartments, houses, and commercial property. Failure to do so can result (and has resulted ) in substantial penalties and legal problems with the Mexican tax authorities.
It is now easy to pay these taxes and avoid problems even if you or your foreign non-resident clients do not have a Mexican tax identification number (RFC). The Settlement Company® has developed a simple and easy procedure which will allow you to be tax compliant on rental income. You do not have to suffer the consequences of failing to pay. Email us now to learn more and to get started. email@example.com
the settlement company®
(serving the Mexico real estate community since 1991)
Note: We work with all property managers. the settlement company® does not manage any properties.
The Good News: The IVA you pay in Mexico is deductible on your US tax return and the income taxes you pay in Mexico can offset your US taxes on the same income dollar for dollar. You will not be double taxes.
*IVA is paid by tenant but collected and declared by owner. Applies to furnished residential properties only.
If you need assistance with the US tax aspects of rental property in Mexico or any other country, or estate planning with respect to your US assets please contact Don D. Nelson at firstname.lastname@example.org or US 949 480-1235. We can help you plan out the US tax consequences of your Mexican real estate transactions and advise you on how to hold title for the best US tax results.