USRPI = U.S. Real Property Interest includes more than a direct interest in real estate.

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USRPI SUBJECT TO FIRPTA WITHHOLDING

•Real Estate: permanent improvements, structures and structural components relating to operation or maintenance

•Real Property including unsevered natural resources such as mines, wells, crops, timber or other natural deposits, and property associated with the use including movable walls and furnishings

•located in the USA, its territories or the US Virgin Islands, and... 

 

Investment Income: Certain income from US sources connected with the trade or business of USRPI.  This is broken down into: 

• Effectively Connected Income (ECI) which is subject to deduction offsets and

• Fixed, Determinable, Annual or Periodical Income (FDAP), which is not.

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Our examiners employ multiple tests to determine if dispositions are assets business activity income.