Check System
Send us your comment!

Your comment will be read by our web staff, but will not be published.

Please do not enter any personal information. Your comment is voluntary and will remain anonymous, therefore we do not collect any information which would enable us to respond to any inquiries.

However, IRS.gov provides a How to Contact the IRS page where you will find guidance on where to submit specific questions.



Share this presentation
Copy and paste the following URL to share this presentation
To email a link to this presentation, click the following:
Bookmarks
This program writes a small 'cookie' locally on your computer when you set a bookmark.
If you want to utilize this feature, check the following checkbox. Otherwise, bookmarks will be disabled.
This is an IRS
audio presentation.

To view this page, ensure that Adobe Flash Player
version 10 or greater is installed.

Get Adobe Flash player

Note: The tax rate increased from 10 percent to 15 percent in December of 2015.

Hi.

My name is Cindy, and I work for the Internal Revenue Service.

Here's some information about purchasing real estate in the United States from a foreign owner.

People from all over the world invest in United States real estate.

If you're buying property from a foreign owner, here are some things you need to know.

The Foreign Investment in Real Property Tax Act of 1980, also known as FIRPTA, may apply to your purchase.

FIRPTA is a tax law that imposes U.S. income tax on foreign persons selling U.S. real estate.

Under FIRPTA, if you buy U.S. real estate from a foreign person, you may be required to withhold 10% of the amount realized from the sale.

The amount realized is normally the purchase price.

The withholding is how we collect U.S. tax owed by foreign sellers.

Here's how FIRPTA works.

If the law applies to your purchase, then within 20 days of the sale, you are required to file Form 8288 with the IRS.

Along with the form, you submit 10% withholding.

It is important to know about FIRPTA, because if you do not withhold the required amount, file the form on time, and submit the withholding, penalties do apply.

There are some exceptions.

For example, FIRPTA law does not apply if you are buying a residence for $300,000 or less or the property is not a U.S. real property interest.

To learn more about FIRPTA, including whether the law applies to your purchase, visit www.irs.gov and type FIRPTA into the search field.

You can also get a copy of Form 8288 on IRS site at the Forms and Publication page.

The forms come with instructions.