FIRPTA exemptions are something you don't generally deal with on a daily basis and it is a good idea to know a little about it. I am lucky to deal with foreign transactions on a regular basis but do realize that many Realtors don't.
If you are selling a home that belongs to a foreign national there is a 10% withholding that takes place at the closing table to satisfy the IRS taxes. Your foreign national must complete a tax return to get this money back but there is a way around this.
According to Internal Revenue Service Code 1445, if your foreign seller is selling a home that is under $300,000 in value, they can ask the buyer to sign the Buyer's Affidavit for FIRPTA Withholding Exemption. This is a form that states that the buyer is going to reside in the new home for a minimum of 50% of the time for the first two years that they own the property. The buyer also acknowledges that if they do not comply with this rule, the IRS can come back and fine them plus make them (the buyer) pay that 10% withholding and any interest due.
A little knowledge like this can be extremely helpful and just another reason why foreign nationals need to be sure that they are dealing with a Realtor that is familiar with the rules and regulations that apply specifically for their purchases and sales of property here in the USA.
Buying or Selling - - Call Barbara-Jo for all of your real estate needs! - - 727-512-0910
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Barbara-Jo Roberts Berberi, MA
Charles Rutenberg Realty
Serving the Greater Palm Harbor Florida Area, including Crystal Beach, Dunedin & Tarpon Springs Florida
Waterfront condos & homes
Your Real Estate Specialist
If you are thinking of purchasing in the Palm Harbor, Crystal Beach, Safety Harbor, Dunedin, Tarpon Springs area or along our pristine Gulf Beaches, give me a call! With years of experience in the local real estate market, I am here to assist you in making one of the most important purchases of your life! Give me a call today! Find out for yourself why living along the Gulf Coast is indeed living in Paradise!