00:02
In the sec, rental income, hans will subjected to u .s.
00:09
Federal income tax on his rental income of $3 lakh.
00:16
The income will be taxed at a flat rate of 30 % under code section 87, subsection, sorry, code section 871, subsection d, since hans is a non -resident alien and does not have a green card.
00:42
Then, operating expenses, hans can deduct his operating expenses of $2 ,20 ,000 from his rental income, resulting a net rental income of $80.
01:00
Then, sale of building, hans will be subjected to u .s.
01:06
Federal income tax on the gain from the sale of the building.
01:11
The gain is calculated as the price of $2 .9 million minus the adjusted basis of $2 .5 million, which results in a gain of $5 lakh.
01:30
The gain will be taxed at a flat rate of 30 % under code section 871, subsection, d.
01:44
Now, withholding, the property management company that sublets the building to tenants is required to withhold 30 % of the gross rental income paid to hans...