I was suspecting H1-B status with that kind of income for an engineering job. Until you have green card status, you are an international college applicant, and your affordable options are very limited. Even when your status does change, your options could still be quite limited because of finances. What are your grades and test scores like so far? What state do you live in? Is there anything within commuting distance? Does your mom plan to get a job when her status changes? Will your dad move to a better paying position, and might that necessitate a move to a different state?
Line 17, Form 1040 “Rental real estate”. We also attach a Schedule E, when filing our taxes.
Form 1040 line 17 and schedule E aren’t used to tax assets based on their value; the purpose is to report income that may be derived from the assets. Big difference. An overseas property that isn’t producing income or causing a loss need not be mentioned on federal income taxes.
Thank you @BelknapPoint!
Thank you @BelknapPoint .
This would only apply IF the property was a rental property. I didn’t see anything here that indicated that it was.
I do qualify for in-state tuition.
Yep, for the first five years, the average salary was about 12k a year. I just pretty much ate the government cheese from welfare and free school meals (my grandparents were greencard holders).
Are you sure? They aren’t US citizens or even legal residents (they have nonimmigrant visas).
I am pretty sure only US citizens and legal residents/immigrant visas have to pay taxes on overseas property.
I haven’t asked my parents yet but a quick google search apparently states that only US citizens and greencard holders get taxed on overseas assets.
It is technically a rental property (it generates revenue and someone resides in it), however, my parents make no income from it (and no transaction regarding it has ever taken place in the united states). All of the money it generates instead goes to my uncle, who lives inside of China and manages the property (alongside his own business).
ALL assets of your parents MUST be put on your financial aid application forms.
The real estate asset does NOT get put on your tax return unless it is generating income…as in a rental property.
See post 22 above for the explanation.
The assets, however MUST be listed on your financial aid application forms. Since you are not yet a citizen, you can’t complete the FAFSA. Whatever your college requires of international students is what you will need to complete.
The assets in the other country will be a required listing on your financial aid application form.
It doesn’t matter who it goes to. If someone is paying rent or leasing it, a transaction has occurred and your parents are the owners.
Your post 25 sheds a completely different light on all of this.
The overseas property IS a rental property…it is generating rental income. Your family is CHOOSING to use that to pay a relative. That is their choice. But it does NOT change the fact…it IS a rental property.
SOOOO…
I’m changing my response.
- You will be REQUIRED to list this asset on your financial aid forms. The value of the property will be listed...and the rent as well.
- If your parents are filing U.S. tax returns...I believe they would be required to put a rental property on their taxes as noted above.
@BelknapPoint now that we know this IS a rental property…could you advise?
And to @RMNiMiTz just remember this…if you get need based financial aid by providing inaccurate or dishonest information, it is considered fraud.
My guess is that a non-citizen earning income from a non-U.S. asset would not owe U.S. income tax on that income. As noted, however, if the student becomes eligible to file FAFSA, the real estate would need to be reported on FAFSA as a parent asset, and it sounds like the rental income would need to be reported as parent income.
Ok…so I am a bit confused (or maybe I need to explain it better). So my parents own a property that my uncle manages and rents out. They don’t partake in the transaction at all (my uncle finds the renters, charges them for staying in my parent’s house, they pay him etc. etc.)
So how would the US government ever find out about this property (not saying that my parents would want to commit fraud or anything). For all they(US Gov’t) knows, it could be vacant (after all, the transactions are not being recorded under my parent’s name or anything like that). I mean (from my pov), how could the US government ever find out that my parents were allowing somebody to use their property to generate revenue? Without any paperwork (my uncle and my parents are very close, as in most Chinese families, so there is an informal arrangement), I don’t get what process would be used to ever find out.
On paper, my parents have never received a penny from this property, so I don’t know where the IRS would go to find out such a thing.
Again, I am not saying I/my parents would try and do anything illegal, I am just asking.
Your PARENTS own this property. The property is earning income. That income is THEIRS…because they own the property. That your uncle is managing it doesn’t matter. Your parents are the owners.
And an informal agreement isn’t going to,support your claim that this income from your parent owned property is not your parent’s income.
And the value of the asset is theirs anyway…and that will need to be reported on the Profile…and the fafsa (when you become eligible to file it).
How could your colleges find out about this foreign asset? I don’t know…but is that a risk you are willing to take? If you get aid fraudulently…you run the risk of getting caught…losing any aid you received, and losing your admissions spot to the college. In addition, you can be fined.
Also, you are not a citizen…is it worth risking your immigration status? Fraud is a crime.
Is it worth even ASKING about if or how a college can find out?
Bottom line…the value of this asset is an asset for you. It doesn’t matter where it is…it must be reported. To do otherwise is dishonest.
Your uncle is acting as their agent, managing a property that they own. Technically they are paying him by allowing him to keep the rents.
Are you sure none of the money ends up saved for your parents? A million dollars of real estate assets is likely generating more than your uncle’s salary
This is from your OP in this thread.
Regardless of the income this generates…your parents are REQUIRED to list the value of this asset on your financial aid application forms. REQUIRED.
So…let’s take the fafsa amount of 5.6% of asset value. If there is $1,000,000 in assets…that would add $56,000 to your family contribution.
If your parents are owners, it doesn’t matter that your uncle holds the rental money. I wouldn’t even see this as them “paying” him. OP’s parents want to return to China and I suspect they will then get some chunk from the uncle and live well. Not uncommon.
But the colleges don’t owe you aid for this.
First you said they’ve received nothing.And now you say, on paper, they haven’t received a penny. That does lead to questions.
But really…the rent is the tip of the iceberg. An asset of $1 million dollars will add $56,000 to the family contribution at your prospective colleges. This is a secondary piece of real estate…and the equity in it MUST be included on your financial aid application forms. MUST.
@Snowball City
I am sure some of it is (especially when they return to China), but like I said, that would be the gov’t trying to predict the future.
Ah, so it doesn’t matter if there is income or not, it still counts?
So (if my math is working out right) 1,300,000 USD would mean that my family contribution counts as 72,800 USD?
Welp, according to the fafsa calculator, once I add in some other investments, I might as well skip out on fafsa at this point.
I thought fafsa was federal aid?
Yep…the equity in that foreign real estate is what is reported. If it’s $1.3 million…that would add a lot to your family contribution.
right now, you are NOT eligible to file a fafsa anyway…as you are not a green card holder.
You would be completing whatever other forms the school requires for financial aid consideration.
Were you planning to apply to colleges that require the CSS Profile?
If…and I mean IF you get your green card, you might be eligible for the simplified needs test IF your family income is really below $49,999 a year. This is for,the FAFSA…you would need that lower income AND you would need to be eligible for a means tested benefit like free or reduced lunch or SNAP. Not your grandparents…you! If eligible, your assets would not be counted.
However, right now…you can’t file a fafsa.
There is NO simplified needs test for Profile schools…so,that asset would be counted.
I mean, the fafsa calculator asked for assets and when I plugged it in, the calculator came out with $0 in aid, even though I put in 45k for household income, no work-study, and no loans.
I suppose for the government that it would be logical to conclude that 1,300,000 in assets is enough to pay for 120k of college.
I feel like we are beating a dead horse at this point 
Yup. You want to lie. We are telling you not to.