Our Canadian clients ask us all the time about the tax ramifications of buying property in Arizona.
First of all, we advise them to always consult with a CPA or Tax Advisor to find out about their particular situation. However we would like to clear some things up, as it applies to almost all residential purchases.
Canadians are happy to learn is that there is no sales tax on their home purchase.
Canadians will only have to pay property taxes just like all the other happy homeowners in Arizona. Rates vary from city to city so it is difficult to give an exact computation formula, which takes into consideration school taxes, special bonds, size, location and the value of home.
Another thing that we would like to point out is that property taxes do not reset or adjust at time of sale, based on the sales price.
Property taxes are assessed across the city on an annual basis. The good news is that property values have been declining in the past few years and property taxes have been declining steadily as well. The 2012 preliminary estimates on most homes are down as well from 2011.
We would like to point out that many Canadians have heard that there is a different property tax rate for foreigners then there is for Americans. We cannot be certain about any other states in the US, however here in Arizona this is not true. We all pay the same rates. Rates are based on whether you are a full-time Arizona resident, a Snowbird, or a foreign Snowbird.
Finally, when you sell your property in Arizona you will be subject to the Foreign Investment in Property Tax Act (FIRPTA) requirements to comply with the IRS. Click here for all the details on FIRPTA
If you want to find out more about buying and investment opportunities up close and personal, join us next month in Toronto, Calgary or Edmonton for one our presentations; Arizona Real Estate Investing 101. Get your seat before they are all Gone!
Finding your next home is just a phone call away:1-888-844-0001
