I’ve heard it as well. Do a search and I’m sure you’ll find some chatter on it.Was told by one broker that Disney does not buy back any international seller contracts?
Any truth to this?
I've read multiple conversations before with the 'Disney has never taken in ROFR an international seller contract' claim. No one has ever later popped into the conversation to say they were an international seller, or were buying from an international seller, and the contract was taken in ROFR.
I would expect the lawyer managing the closing to know and withhold taxes as appropriate from the settlement. Checking my closing documents, I see that the firm handling the closing withheld on my behalf.
Somehow I think Disney would go the extra mile and take from a foreign seller if the price offered was low enough AND they had a waitlist for the points. The breakeven price for Disney may be so low for foreign sellers that they never exercise.
The money laundering angle may have more merit.
Withholding tax is not really a tax. It's like when an employer withholds your income tax on your payroll. It's just an estimate on the tax that you owe.I agree on the break even, I didn’t buy international so I have some questions for you, how much were your closing costs in total?
I’m wondering if it is actually 15% that they withhold. If the closing costs are taking the extra 15% in withholding, then some international contracts may actually be more expensive.
For example, I’ve heard of The podcast talking about a $88/pt BRV contract from an international seller. Adjusted 15% would be a $101/pt contract. Which would be in line with the market ($97-125 July-Sept) I think that’s a pretty big difference and consideration for anyone looking to buy and making an offer on an international contract.
Withholding tax is not really a tax. It's like when an employer withholds your income tax on your payroll. It's just an estimate on the tax that you owe.
Example) You buy a contract from me for $15,000. Instead of paying me $15,000, you pay me $12,750, and send $2,250 to the IRS. Your obligation is now done.
As the international seller, I must now file a US tax return that will show either a capital gain or loss. If there is a capital loss, I owe no money and get the $2,250 back. If there is a capital gain, and I owe more than $2,250, I send the IRS the difference. If I owe less than $2,250, they send me the difference.
The reason they have the withholding tax is so that a foreign person who owes money to the IRS doesn't just leave the country and never pay.
Its not a real cost though.....So based on that scenario, if I offered you $100/pt. the reseller takes their commission - we’ll say $10, taxes of $15, you’d get $75/pt in your pocket.
So using the same podcast, that would suggest that BRV sold for $88 the seller would’ve only received $66/pt in their pocket.
This is a little different from what jscottnc said on his closing costs. I think his scenario put the concern of extra costs to the buyers at closing. Yours puts a concern of extra fees on the sellers potentially not getting as much as they’re looking forin their pocket
I Just did a quick search for reseller sites and seller fees and it doesn’t look like any of them disclose of pulling that amount out for taxes. I think I understand the withholding, but more curious as to how it’s carried out. The costs have to be absorbed somewhere..either the buyer, seller, or from Uncle Sam.
I've heard it is rare but I can personally tell you that they do. We were purchasing two contracts from an international seller and we were notified yesterday that Disney bought them back.Was told by one broker that Disney does not buy back any international seller contracts?
Any truth to this?
What was the contract?I've heard it is rare but I can personally tell you that they do. We were purchasing two contracts from an international seller and we were notified yesterday that Disney bought them back.
Two contracts for the Grand Californian.What was the contract?
I've heard it is rare but I can personally tell you that they do. We were purchasing two contracts from an international seller and we were notified yesterday that Disney bought them back.
Thanks. We were pretty disappointed. As I understand it, Disney has about 30 days to decide if they want to buy contracts back. Our offers were submitted to Disney on Sept. 7th and I was hopeful as we were getting close to that 30-day mark and on Oct. 1st, we got word that they bought them back.Wow, you are the first I've ever read give a personal first hand account of an international seller contract being taken in ROFR. I guess Grand Californian would be the resort where it would happen. Sorry.
There was another VGC ROFR'd yesterday on the ROFR thread. First I'd seen of VGC, and now TP3 gets two taken... international seller to boot.Wow, you are the first I've ever read give a personal first hand account of an international seller contract being taken in ROFR. I guess Grand Californian would be the resort where it would happen. Sorry.
Sorry to hear that. Would you mind sharing the details of the contract?Thanks. We were pretty disappointed. As I understand it, Disney has about 30 days to decide if they want to buy contracts back. Our offers were submitted to Disney on Sept. 7th and I was hopeful as we were getting close to that 30-day mark and on Oct. 1st, we got word that they bought them back.
Sure, there were two contracts each with 190 points. I don't remember the exact amount but one contract had about 90 banked points. Both contracts had all 2019 and all 2020 points available. We offered the asking price of $195 per point. The sellers were in Canada.Sorry to hear that. Would you mind sharing the details of the contract?