FIRPTA is a tax law passed in 1981 that requires foreign persons to pay U.S. income tax on the gains they make from selling U.S. real estate. The duty is on the U.S. national buyer (and not the settlement agent) to deduct and withhold a portion of the sales price and report the sale to the Internal Revenue Service (IRS). Buyers can withhold less than the statutory amount if they obtain a determination of the specific amount of tax owed by the foreign national using IRS Form 8288-B. In most cases, the settlement agent is the party that actually remits the funds to the IRA, but the buyer is held legally responsible. Additionally, until the tax is paid in full, the government obtains a security interest in the real property.
Latest Posts
by dblfadminHOA DUES
What can I do to stop my HOA dues from increasing? Unfortunately, when an HOA is faced with many non-paying homeowners and potential deficit spending, they...
by dblfadminREAL PROPERTY INTERESTS
WHAT ARE FREEHOLD ESTATES? Freehold estates are possessory interests in land of indefinite duration. The duration of a freehold estate may, however, be...
by dblfadminBENEFITS OF PURCHASING A LAND TRUST
A land trust is a legal device for holding any interest in real property in which legal and equitable title is transferred to a Trustee. There are several...