Foreign Property

Discussion in 'Life After the Academy' started by AVT, Jun 13, 2011.

  1. AVT

    AVT USAFA 2015

    Joined:
    Sep 7, 2009
    Messages:
    373
    Likes Received:
    5
    I have inherited foreign property beginning 8 years ago.
    When I am 18 in September, I will possess the legal power to make decisions on it.

    As a Cadet and later Officer am I allowed to own foreign property?
    Can I also conduct business on it?

    Thank you in advance! :thumb:
     
  2. Pima

    Pima Parent

    Joined:
    Nov 28, 2007
    Messages:
    12,796
    Likes Received:
    930
    I will not answer for the cadet question, but I know as an Officer you can. Obviously it will depend on the country, but overall the answer is yes. We knew many officers stationed overseas that could not get base housing and opted to buy.

    You will need to inform the command and get their approval. Also it will be investigated for your security clearance.

    This is also true for businesses. The main reason why is due mainly to the fact of image. Image not only because you are expected as an officer to conduct yourself in a certain manner, but also image in the fact that the business cannot be tied to them, looking like they play favorites to members and have connections with them...Think non-compete.

    I don't know what business you are thinking about, but you are very young. Anyone with age and experience will tell you even running a small business takes time and dedication. A LOT OF IT, if you want to earn a profit.

    Your job right now is education and serving in the military. Many HS srs believe that because school has always been easy and had tons of time to play XBox or hang with friends that this will continue. This is a fallacy. As a cadet and a newly minted officer, you will be hitting the books often and for long periods.

    Want to fly or go SEALS/DELTA. People will tell you it is hard, hard, hard for the 1st yr or two. Downtime is Friday night and by Sunday morning you are back to the grindstone studying. Trying to juggle a business and the military may result in failure for one or both.

    Additionally, this business would be overseas. While you are at school, even at WP/USNA and the property is in the UK, they are finishing their business day. While you are studying they are sleeping. That leaves you getting up early to email/phone before their day begins...think 3 a.m. AFA think staying up to midnight.

    Personally, I cannot think of any business where this is a doable scenario because we haven't even discussed deployments to places like Afghanistan. Even if your business was to raise sheep and sheer them for wool with an overseer, it would still take time out of your day to discuss bills, revenues and status. We had friends with successful businesses that actually took a pay cut to join the military, within months they sold the business because they couldn't juggle both. Small business owners, even if it is an internet business spend 7 days a week 8-12 hours a day grooming it to be successful.
     
  3. AVT

    AVT USAFA 2015

    Joined:
    Sep 7, 2009
    Messages:
    373
    Likes Received:
    5
    Thank you for the response.

    I'll be more specific. Basically, what I own is an apartment in Russia.
    The kind of "business" I meant was renting it out to family members.
    I will either try to sell the property, rent it out, or just continue to own it.
     
  4. Pima

    Pima Parent

    Joined:
    Nov 28, 2007
    Messages:
    12,796
    Likes Received:
    930
    Dang, Russia?

    I suggest you talk to command immediately. You will need a security clearance, and this may be an issue. Not saying it is, just saying be proactive and ask if it would be.

    That aside, renting out even to family members will require you to do a long form for your 1040. At this point I would suggest you talk to a tax specialist, because you could owe a chunk of change every yr since it is an "investment" property, which is taxed at a different rate. Believe it or not, rentals are a pain when it comes around April 15th. You have to deal with everything from revenues to property taxes to depreciation. Trust me I know, we own a rental property and even with Turbo tax I want to pull my hair out. Our property is in the US, I am pretty sure if we owned and rented outside of the US, not only would I be bald, but Bullet, my kids, the two dogs and the cat would be too!

    JMPO, but between these two issues, I would sell it!
     
    Last edited: Jun 14, 2011
  5. AVT

    AVT USAFA 2015

    Joined:
    Sep 7, 2009
    Messages:
    373
    Likes Received:
    5
    Country of origin.

    There was a question about foreign property in the SF 86 Security Clearance Form which I answered accordingly.
     
  6. Pima

    Pima Parent

    Joined:
    Nov 28, 2007
    Messages:
    12,796
    Likes Received:
    930
    The AFA clearance is not a TS clearance. If you want to fly you need a TS clearance. It is @50 pages. They send "special agents" to your home, to the homes of the people on your list and interview them. The interview is about 30-45 minutes. The clearance lasts for 5 yrs and updated every 5 yrs.
     
  7. bjkuds

    bjkuds Parent

    Joined:
    Oct 25, 2010
    Messages:
    614
    Likes Received:
    15
    Don't know if this is still the way it is since the break up of the USSR but my husband was all set for OSI back in the day. Top in all the schools etc.. got to his security clearance and was turned down for Top Secret status because he had living relatives in the Ukraine that his father had visited 2 times since becoming a US citizen. He never had personal contact with anyone himself yet they wold only grant a secret clearance and they made him a cop. Nothing quite like base entry control for 4 years with a secret clearance when you are hoping for OSI.
    I agree with Pima that it may be in your best interest to cut those ties. They will see it as a foreign interest and financial to boot. JMPO any ties that show even the slightest possibility that makes you vulnerable to foreign influence gets put under a microscope. One other thing that I failed to mention..He had a sister that was not a US citizen..a citizen of Germany. When their parents came over in the Berlin airlift she was 4 years old and she never got her citizenship like the rest of them, so if you have close relatives that are not citizens that alone could prevent a TS clearance.
     
    Last edited: Jun 17, 2011
  8. bjkuds

    bjkuds Parent

    Joined:
    Oct 25, 2010
    Messages:
    614
    Likes Received:
    15
    Funny now that he is out he works a Fed job that deals with secret squirrel stuff and they still visit our neighbors every five years. Once I made a bank deposit of 7k into our joint account when I received inheritance from my father passing and guess who was at my door 2 days later. FBI.. He was nice about it and it was easily explained. I Don't know how they find out that stuff but its amazing the things that trigger suspicion.
     
  9. bpu

    bpu Member

    Joined:
    Jul 29, 2010
    Messages:
    54
    Likes Received:
    0
    Try to dump it. 1040 long form plus a host of money laundering regulations to comply with. Here is just one more thing to worry about. Deadline here is 06/30.
    http://www.irs.gov/pub/irs-drop/n-10-23.pdf

    Get some tax and/or legal counsel. Inherited a property in Russia? Sounds like a nice PITA to me.
     
  10. AVT

    AVT USAFA 2015

    Joined:
    Sep 7, 2009
    Messages:
    373
    Likes Received:
    5
    I can't legally take any action on it til I'm 18 in September.
    I had given a relative power of attorney for before I became of age, but he is not allowed to take action on the property.
    I'll do my best to clean my hands of this as soon as possible, for I don't want to harm my career.
    I sincerely appreciate everyone's responses.
     
  11. Pima

    Pima Parent

    Joined:
    Nov 28, 2007
    Messages:
    12,796
    Likes Received:
    930
    There are different types of POAs. You probably gave them a general POA, under this type financial aspects including opening a checking account cannot be done. However, you can get a specific POA which will allow them to sell the property on your behalf. Trust me not only as a wife I have had both types, but I am also a licensed Realtor and have accepted them too, I could not use general, just specific.

    Even if you waited until you were 18 and tried to do it. Selling a home comes with a lot of paperwork. Just the contract to list in VA is 10 pages, the purchasing contract is 30 pages and that is if everyone agrees, nobody counters. Realtors are allowed to fax for contracts, but not for settlement papers (we overnight those, and they must be signed in front of a notary).

    This is obviously going to be more complicated for you because of the time zone issue.

    Not trying to scare you, just trying to inform you that buying and selling property even in the states is very time consuming and includes a lot of paper. This is why I would recommend investigating to see if you can get a specific POA. It will state the actual address of the home.

    Remember to keep all of your paperwork including the POA, because for your TS as bjkuds stated they are going to investigate everything for you and that will include your connections overseas.

    You may also want to look into transferring the title for the ease of everything. What we do here is place another person's name on the title. After a period, you would than do what is called a quit claim and have your name removed from the title. The property would remain in your family, but you would not be legally tied to it. I am assuming that there is no mtg., so that is why this maybe an easier option.

    Either way it is still going to be a question that you will need to address because you have owned it, yet you will be relieved of the property.

    I would also suggest you talk to a tax attorney since there will be tax implications.
     

Share This Page