Selling A Home With FIRPTA: What You Need To Know
If you're a non-U.S. citizen looking to sell your U.S. property in Central Florida, it's important to be aware of the Foreign Investment in Real Property Tax Act (FIRPTA). This law requires foreign sellers to pay a withholding tax on the sale of their U.S. property, and failing to comply with FIRPTA requirements can lead to serious consequences.
At The Stones Real Estate Firm, we are Central Florida FIRPTA real estate agents who specialize in helping foreign sellers navigate the FIRPTA process and ensure a successful sale.
Here's what you need to know about selling a home subject to FIRPTA:
What is FIRPTA? FIRPTA is a federal tax law that requires foreign sellers to pay a withholding tax on the sale of their U.S. property. The withholding tax is a percentage of the gross sales price, and the amount withheld is submitted to the Internal Revenue Service (IRS) by the buyer/closing company.
Why is FIRPTA important? FIRPTA is important because failing to comply with the law can result in serious consequences, such as penalties and even the seizure of the property. It's crucial for foreign sellers to understand and adhere to FIRPTA requirements in order to avoid any legal or financial issues.
How does FIRPTA impact the home selling process? If you're a foreign seller selling a U.S. property, FIRPTA will impact the home selling process in a few ways:
1. Withholding tax: The buyer will be required to withhold a percentage of the gross sales price and submit it to the IRS. The percentage withheld depends on the sales price and is typically 15%.
2. FIRPTA certificate: Before the sale can close, the foreign seller must obtain a FIRPTA certificate from the IRS. This certificate confirms that the withholding tax has been paid or that an exemption applies.
3. Tax filing: After the sale, the foreign seller must file a tax return with the IRS to report the sale and any withheld taxes.
How can The Stones Real Estate Firm help? Our office works closely with FIRPTA tax law experts who specialize in Central Florida real estate transactions involving foreign investors. These tax experts help ensure full compliance with US tax laws and requirements for filing and paying while minimizing our clients’ tax burden. Our team is here to guide you through every step of the process, from obtaining the FIRPTA certificate to filing the necessary tax returns.
Ready to sell your Central Florida property as a foreign seller? Contact experienced our FIRPTA Realtors today to learn more about how we can help you navigate the FIRPTA process and achieve a successful home sale.
Michael Stone: 863-412-9733 or Deanna Stone: 863-412-2080