If you are a Non-US citizen buying or selling real property (real estate holdings) in the United States, understanding FIRPTA, the Foreign Investment Real Property Tax Act, and obtaining the right tax advice from the beginning can help avoid costly mistakes and quite possibly save you thousands of dollars and a lot of time and stress. 

When a Non-US person has US income by selling real estate they will be subject to the FIRPTA guidelines. In most cases, the IRS will require 15% of the Sales Price to be withheld and sent to the IRS within 20 days of the closing. Applying for a Withholding Certificate is a way to reduce or even eliminate the tax withholding. There are even a few situations where your transaction MAY be exempt from the FIRPTA withholding. 

Many times the seller may not have been aware that they were required to file US Taxes or may not have applied for an Individual Taxpayer Identification Number. These are issues that will take time to resolve. Dealing with these types of issues can help to avoid a delay in the closing or even a lost sale.

Clients rely on Pfeifer Realty Group to help them achieve their real estate goals successfully. When we work with Foreign Buyers and Sellers, we trust Carol McCarley with Noack and Company to help our clients navigate all their FIRPTa and Foreign Tax Filing needs.