FIRPTA Compliance

FIRPTA stands for the Foreign Investment in Real Property Tax Act. It is a federal law that requires foreign persons selling U.S. real estate to pay taxes on the sale. If you're purchasing property from a non-U.S. seller, you may be legally responsible for ensuring proper tax withholding at closing — typically up to 15% of the sales price.

What Our Title Company Does for FIRPTA Compliance

• Review seller documentation to determine FIRPTA applicability.
• Coordinate with buyers, agents, and sellers to ensure timely compliance.
• Prepare and file IRS Forms 8288 and 8288-A, if required.
• Hold and remit required tax withholding to the IRS.
• Assist in processing Withholding Certificate requests (if exemptions apply).
• Ensure all necessary certifications are executed and on file.

Who Is Considered a “Foreign Person” Under FIRPTA?

• Non-resident aliens (not U.S. citizens or green card holders)
• Foreign corporations or partnerships
• Foreign trusts or estates

Are There Any Exceptions?

• Sales under $300,000 where the buyer will use the property as a primary residence
• The seller provides a valid Withholding Certificate from the IRS
• The seller signs a Certification of Non-Foreign Status (if applicable)