Property Taxes in the U.S. Virgin Islands

Buying and selling property in the U.S. Virgin Islands is a little different from buying on the mainland. Two important differences are in the areas of financing and taxes. For your initial financing you will have to work with a mortgage company or bank licensed to do business in the territory. It is a short list.

Taxes on commercial property in the U.S. Virgin Islands have been in dispute since 2000. When the governor unveiled a proposed property tax structure creating different property categories, each with different tax rates in 2007, residential property was pulled into the fray.

When closing on a property in the Territory, Buyers are credited an estimated amount for each year of outstanding taxes the Seller are not able to pay due to the lack of an official bill (the tax assessors office cannot accept payment for taxes not officially billed). The estimated taxes were usually based on the last valid tax bill which was issued in 2005 and based on 1998 valuations. In August of 2010, valid tax bills were issued for 2006 taxes and are also based on 1998 valuations. The responsibility to pay the taxes transferred to the new owners along with the property.

This has been off putting to some Buyers who now have reason to take heart! On January 22, 2011 Judge Gomez, Chief Judge of the District Court, lifted the freeze on property taxes in the U.S. Virgin Islands. The last area of dispute requiring resolution to move forward was a properly functioning Tax Review Board which had been seriously back logged. The back log has been cleared and an agreement was reached with the original complainants and the Board through mediation.

The 1998 values and tax rates shall continue for the 2007, 2008 and 2009 tax years. 2010's tax bill will be the first to be based on fair market value. Tax payers will receive two years of tax bills per year until the bills are current, placing the issuance of 2010 tax bill in 2012.

The infusion of revenue for the government should mean significant relief in budgetary issues and strengthen our economy.

If you have been delaying your dream of purchasing property in the Virgin Islands, because you were not comfortable with this situation, you can relax. Now is the time to buy real estate in St. Thomas, St. Croix or St. John. Prices are good.

Take a look at what is available by visiting www.talk-to-tanya.com to search the Multiple Listings, when you see something that interest you contact Van Blake Coleman Realty at 340-344-2959 or send me an e-mail at tvanblakecoleman@gmail.com