REVERSE CAPITAL GAINS... WHAT IS THIS?   ANOTHER TAX?

Yes, most definitely the Reverse Capital Gain Tax can be a buyers surprise!.

A basic rule of real estate is that the true value of a property is based upon the “willing buyer-willing seller” concept. In other words, the fair value of any property is that which a seller is willing to accept and a buyer is willing to pay, without outside pressures.

Sometimes, however, the seller is in great need of money, or the Buyer is a super

negotiator, or the market is down. Then the appraisal, which is required by law

and is made by a government appointed appraiser comes in with a value that is

higher than the price agreed upon between buyer and seller.

This means the Buyer must pay a higher acquisition tax which is a municipal tax

and generally two percent (2%) of the appraised value. That is probably OK and

not a huge expense. What does cause the groans is when the appraisal exceeds

by 10% the selling price of the property. At that point the Buyer will then be liable

for a Reverse Capital Gain tax. The Buyer then pays 25% Capital Gain Tax on the

overage.

Here in CANCUN ESTATE we help you with any tax calculations and payments, or a Fiscal planning for optimum return on real estate investments. Even with Conflict Resolution for all types of real estate problems.

Contact us, we are professionals associated with AMPI and NAR.