If you are a foreign individual and you are selling your property, or if you are a buyer purchasing a property from a foreign seller, then you will most likely be subject to the Foreign Investment in Real Property Tax Act of 1980 (FIRPTA). In a FIRPTA real estate transaction, 10% of the sales price is withheld from the sellers' proceeds by the IRS until their tax return is filed the following year.
It is ultimately the buyer's responsibility to ensure the FIRPTA real estate transaction process is properly conducted. If the buyer does not properly conduct the FIRPTA process, then they could be subject to penalties for the taxes not paid by the seller.
Written by: Jessica LaBerge, Boyer Law Firm
Average 30-year loan rate falls to 3.89%
