pelone - 2-25-2015 at 06:36 PM
Our property manager had assured us that every tax had been paid, to include the income tax and lodging tax. However--this was a bogus claim. IRS
code 3520-A requires that Annual Information of Foreign Trust With a U.S. Owner be submitted. If you rent your house to folks in Mexico, you are
required to submit this in the USA. Also, The Mexican regulations stipulate that property managers have a designated and particular factura in your
file for your property for all rentals to prove that you and your manager have been paying Mexico tax. If this cannot pe shown--you are likely being
hood-winked. Your property could be in jeopardy! Our manager was also renting out our house and not notifying us---we were 2000 miles away.
Neighbors alerted us to this scam. Now the manager has the nick name estafadora.
bajaguy - 2-25-2015 at 06:50 PM
Sounds like you need a new property manager. The one you have now is a liar and a thief
pelone - 2-25-2015 at 08:24 PM
Have new property manager---the old one was charging 22% for income tax and lodging tax but not paying the tax to Mexico and was instead pocketing it.
When asked to show the facturas that were supposed to be sent from the bank to our file---was told "that is not how we do it in Mexico!!
bledito - 2-26-2015 at 07:13 AM
world wide income. any income earned in Mexico has to be reported in the USA. personell homes used as rental must be reported as such. the penalties
are big for not doing so. I am looking into all this stuff with my tax advisor so there may be more as well. Undeveloped land may fall into this
catagory as well.
pelone - 2-26-2015 at 07:46 AM
A major problem can occur when your property manager does not pay the lodging tax, gives you a quick books end of year account history that is false.
Without the "proof" of the factura from the bank, you become in jeopardy in both countries. What would you say, also to a management company that
rented out your house for 180 dollars a night for 20 nights and never recorded the rental activity to you, lied about having done it, got in your face
about distrust issue? We found an honest agent.
pelone - 2-27-2015 at 08:57 AM
A friend quizzed me out about my needing to file a 3520-A. "Why declare to the U.S. what is earned in Mexico"---"How are they going to know"? Wake up
and smell the cactus. Mexico banks are being brought into the modern era---Those of you on VRBO are being noticed, whether you are monitoring your
account or using an agent here in Baja.
The ethical thing is to pay taxes---period end.
In my case, the misrepresentation of our properties and lack of transparency was being done by a norteamericano--who has a bad reputation.
bledito - 2-27-2015 at 09:31 AM
undeveloped land purchased for under 50,000 does not need reporting. once the value is increased, a home, or agricultural development, or any
improvments increase this value to 50,000 then you need to report.