Without giving tax advise, any investment property is subject to capital gains tax. And toss in that you are also Canadians, and might be subjet to income tax in Cananda . . . yup, best to talk to a CPA that is knowledgeable on these things.
Real estate agents are only licensed to practice real estate . . . and tax advise really falls outside the purvue of our license. Don't rely on a real estate agent for this information . . . talk to a CPA. Taxes are complcated enough, toss in a rental, toss in Canadian citizens . . . you want to get expert advise from an expert in that area.
But, if you want advise on buying a property don't hesitate to ask!! Real estate I can do :-)
Carla Muss-Jacobs, Principal Broker/Owner
EBA Portland, LLC
Exclusive Buyer Agent since 1999
Below is a small piece of information that may help lead you in the right direction. And of course, I would also consult a tax attorney or a CPA.
Q. My seller is a resident alien, does that mean FIRPTA applies?
A. A resident alien, for purposes of FIRPTA, is not a foreign person. FIRPTA defines a foreign seller as a non-resident alien individual, a foreign corporation not treated as a domestic corporation, or a foreign partnership, trust or estate. There are two ways to determine if a person qualifies as a resident alien under FIRPTA:
1. If a person has been issued an alien registration card ("green card") or
2. The substantial presence test that requires a person be physically present in the United States for a certain number of days a year. 183 days (pursuant to IRS Code).