Hello! My family owns property in the Philippines. We are in final stages of selling it. Because majority of the siblings are here in the United Staes, we have appointed our two remaining siblings who still resides in the Philippines as Power of Attorney and execute the deed of sale, and the sale proceeds will divided equally among the siblings. Our siblings will then wire transfer the shares. Is this considered inheritance? Or gift? What are our tax consequences as recipients (for those of us living in the US)?
Oh gosh — this is too technical for me. First, it depends on how the property is titled. If it belonged to your parents, and they are distributing the money, then it could be considered a gift to each of you. Or if they passed on and left it to all their children, then it would be an inheritance — typically tax-free. But if you all owned it together, jointly, then it would just be the distribution of proceeds from the sale, and perhaps subject to capital gains taxes. BUT, this also depends on whether you are a U.S. citizen and subject to U.S. tax laws — or are citizens of the Philippines and might be subject to their tax laws.
SO, I’m going to suggest you contact a CPA (certified public accountant) who is familiar with the tax laws of both countries. I simply Googled and found this one –although I cannot make a recommendation.