How does tax work if I’m technically an American landlord on vacation?

6 comments

1. This is a copy of your post for archive/search purposes.

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   **How does tax work if I’m technically an American landlord on vacation?**

   I’m looking to potentially buy a property in America and rent out part of it. However, I see it said on here a lot that you cannot earn income from a foreign country *at all* while in japan on a tourist visa, otherwise you have to pay tax to Japan. Therefore, how would this situation apply? How do people with multiple properties in America vacation in Japan and avoid this rule? What if I eventually wanted to move there on a spouse visa, but maintain ownership of my American propertie(s)?

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2. What you’re saying doesn’t make sense – otherwise it would be illegal for anyone who is employed at all to ever set foot in Japan, even for a day, since technically they are earning income for that day from their job back home (not just landlords but office workers or whatever) as long as it’s a paid vacation. I think those posters are referring more to work that you physically do in Japan. Getting paid while on vacation doing nothing is (by the letter of the law) different from bringing your laptop and doing actual work while physically based in Japan.

3. Spouse (and other long-term) visas have different rules than tourist visas. If you’re on a tourist visa, you can’t be doing business in Japan—because you’re there to be a tourist—but you can presumably still maintain employment outside Japan. If you’re on a long-term visa, there are restrictions on where and how you can make money, because you’re a Japanese resident.

4. Yeah like lawfulkitten1 said, as long as you don’t actually work while you’re here on vacation you’re fine. I believe that does mean that you officially can’t respond to issues while you’re here, say if a tenant reports an urgent problem and you need to coordinate someone to come and repair it, so I recommend you make arrangements for someone to fully cover for you.

   Doing it while on a spousal visa is different. The spouse of a Japanese national visa gives you freedom to do this or virtually any other job domestically or abroad while living in Japan. You need to figure out taxes though. The JapanFinance subreddit is a great resource for that.

5. >I see it said on here a lot that you cannot earn income from a foreign country *at all* while in japan on a tourist visa

   You can earn income from a foreign country while on a tourist visa. Millions of people all over the world take vacations in foreign countries while still collecting a salary from their employer.

   In most countries, while you are on a tourist visa, you are not able work and receive income from a job in the country you visiting.

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   >What if I eventually wanted to move there on a spouse visa, but maintain ownership of my American propertie(s)?

   You will generally declare the American rental properties on your Japanese and USA tax forms and pay tax on the income. Your first 5 years in Japan might have an exception though. Someone else posted a pretty good summary here: [https://www.reddit.com/r/JapanFinance/comments/r0tltb/comment/hluq7ir/](https://www.reddit.com/r/JapanFinance/comments/r0tltb/comment/hluq7ir/)

   Even though they are answering about Australia, USA also has a tax treaty with Japan. I live in Japan but I’m renting out my old house in the USA, and the comment that I linked to was helpful in my situation.

6. Renting out foreign properties would be considered foreign sourced income. So unless you’re bringing the money to Japan or been here long enough that you’re considered a permanent resident for tax purposes you wouldn’t owe Japan anything on that income.

   The issue for tourists isn’t earning income. The issue is working for that income.