No: IUSI paid on a house or land in Guatemala that you hold for personal use cannot be deducted on Schedule A of a US federal return, because the IRS 2025 Schedule A instructions list foreign real property taxes among the taxes you can’t deduct.
In short: For tax year 2025, the IRS Instructions for Schedule A exclude foreign personal or real property taxes and tell filers not to put foreign real estate taxes on line 5b. IRS Publication 54 adds one exception: foreign property taxes incurred in a trade or business or in producing income. So IUSI on your own or your family’s home in Guatemala is not deductible as an itemized deduction; IUSI on a Guatemala rental belongs to the rental analysis. The IRS texts do not name IUSI; your preparer applies them and the IRS decides.
What the IRS Schedule A instructions say
The Instructions for Schedule A (Form 1040) (2025) contain two lines that settle the personal-property case:
| Where in the 2025 Schedule A instructions | What is printed |
|---|---|
| Taxes You Can’t Deduct | Foreign personal or real property taxes. |
| Line 5b, State and Local Real Estate Taxes: amounts not to include | Foreign taxes you paid on real estate. |
Line 5b itself is for state and local taxes on real estate you own that was not used for business, assessed uniformly at a like rate on all real property throughout the community. The instructions then name foreign taxes paid on real estate as an amount to leave out.
These are the instructions for tax year 2025. IRS Topic 503, Deductible taxes (page updated 9 November 2026) lists the categories of deductible taxes as state, local and foreign income taxes (or state and local sales taxes instead), state and local real property taxes, and state and local personal property taxes. Foreign income taxes are on that list; foreign real property taxes are not. For another year’s return, read that year’s Schedule A instructions.
Why IUSI is a real property tax
IUSI is the Impuesto Único Sobre Inmuebles. The Municipality of Coatepeque’s IUSI page describes it this way: taxpayers are individuals and companies that own or possess real estate, and usufructuaries of State property; the tax falls on rural and urban real estate, counting the land, structures, buildings, installations attached to the property and their improvements, and also permanent crops such as coffee, rubber and plantain. That is a tax on real property, which is the category the IRS excludes when it is foreign.
Coatepeque, where taxpayers deal with the IUSI office at the municipality, also prints its payment calendar (quarterly instalments in April, July, October and January) and a 20% fine on any amount not paid on time. For how the tax works across Guatemala, unpaid balances and inherited property, see our IUSI guide for owners in the USA, and for what changed in 2026, the IUSI reform guide.
The exception: a Guatemala property that earns income
IRS Publication 54, the tax guide for US citizens and resident aliens abroad (revised December 2025, a continuous-use revision from tax year 2025), says under Deduction for Other Foreign Taxes: “You cannot deduct other foreign taxes, such as real property or personal property taxes, unless you incurred the expenses in a trade or business or in the production of income.”
That sentence leaves the door open for a property you rent out or use in a business. IRS Topic 415 says that if you receive rental income for a dwelling unit you may deduct certain expenses, which may include real estate taxes, and points to Schedule E (Form 1040). Publication 527 (2025) is the IRS guide to residential rental property and the Schedule E rules. None of these texts mentions IUSI or Guatemala by name; a preparer applies the Publication 54 exception to the facts of your property.
| Your Guatemala property | What the IRS text says |
|---|---|
| Home or land you or your family use, no rent | Foreign real property tax: not deductible on Schedule A (2025 instructions) |
| Rented to others at a fair rental price | Publication 54 exception for the production of income; rental expenses go on Schedule E (Topic 415) |
| Used in your trade or business | Publication 54 exception for a trade or business |
| Rented part of the year, used by you or family the rest | IRS Topic 415 says expenses are generally divided by days of rental and personal use |
When family members use the house
Topic 415 counts as a day of personal use any day the unit is used by a member of your family, unless that family member uses it as their main home and pays a fair rental price, and any day it is used by anyone at less than a fair rental price. If you use a dwelling unit for both rental and personal purposes, the IRS says you generally must divide your total expenses between the two based on the number of days used for each purpose, and rental expenses above gross rental income may be limited. Topic 415 also has a special rule: if you use a dwelling unit as a residence and rent it for fewer than 15 days, you do not report the rental income and do not deduct any expenses as rental expenses.
The personal-use share of IUSI stays a foreign real property tax, so it does not move to Schedule A.
Which year a payment counts in
Topic 503 says deductible taxes are deducted in the taxable year you pay them. That matters only for the part of IUSI that falls under the Publication 54 exception, since the 2025 Schedule A instructions put the personal part on the can’t-deduct list. Where IUSI is paid in instalments, as in Coatepeque, keep each payment receipt with the records of the year in which it was paid.
Publication 54 also notes that the deduction for foreign taxes other than income taxes is separate from the foreign tax credit, which is for foreign income taxes. IUSI is a tax on real estate, not on income. For gifting a Guatemalan property to relatives, see US gift tax on money or property for family in Guatemala; for buying, see buying property in Guatemala from the USA.
Sources
- IRS: Instructions for Schedule A (Form 1040) (2025), read 10 November 2026.
- IRS: Topic no. 503, Deductible taxes, read 10 November 2026.
- IRS: Publication 54 (12/2025), Tax Guide for U.S. Citizens and Resident Aliens Abroad, read 10 November 2026.
- IRS: Publication 527 (2025), Residential Rental Property, read 10 November 2026.
- IRS: Topic no. 415, Renting residential and vacation property, read 10 November 2026.
- Municipalidad de Coatepeque: IUSI, read 10 November 2026.
Frequently Asked Questions
Can you deduct Guatemala IUSI property tax on your US return?
Not as a personal itemized deduction. The IRS Instructions for Schedule A (2025) list foreign personal or real property taxes among the taxes you can’t deduct, and tell you not to include foreign taxes you paid on real estate on line 5b. IUSI is a Guatemalan tax on real estate, so a house or land you hold for personal use falls under that exclusion. The IRS decides how your return is treated.
Is there any case where IUSI can be deducted?
IRS Publication 54 says you cannot deduct foreign real or personal property taxes unless you incurred the expenses in a trade or business or in the production of income. A Guatemala property you rent out or use in a business is the case that sentence leaves open; IRS Topic 415 lists real estate taxes among the expenses a landlord may deduct, reported on Schedule E.
Does itemizing or the SALT cap change the answer?
No. The $40,000 cap ($20,000 married filing separately) in the 2025 Schedule A instructions applies to state and local taxes on lines 5a, 5b and 5c. Foreign real property taxes are not entered on those lines, so the cap does not bring IUSI on a personal property into Schedule A.
Can I deduct the IUSI I pay on my parents' house in Guatemala?
Not on Schedule A. The tax is a foreign real property tax, and the same Schedule A list of taxes you can’t deduct also names tax you paid for someone else among certain state and local taxes.
What if a relative lives in the Guatemala house and I also rent it out?
IRS Topic 415 counts a day a family member uses the home as a day of personal use, unless the family member uses it as their main home and pays a fair rental price. With both rental and personal use, IRS Topic 415 says expenses generally must be divided by the number of days used for each purpose.
