What Constitutes a U.S. Real Property Interest (USRPI)?

A U.S. Real Property Interest (USRPI) includes:

Real property located in the U.S. or U.S. Virgin Islands

, including land, buildings, and improvements.

Interests in domestic corporations

that qualify as U.S. Real Property Holding Corporations (USRPHCs). A corporation is a USRPHC if at least 50% of its assets consist of USRPIs.

Certain exceptions apply for corporate interests:

• If the corporation has disposed of all USRPIs in fully taxable transactions, or
• If the corporation was not a USRPHC during the relevant holding period.