Are you subject to a US withholding tax?
Any disposition, generally a sale, of a US property interest by a foreign person (including a nonresident alien, a foreign company or other type of foreign entity), is subject to income tax withholding upon the sale of the property. Income tax withholding can be as high as 15% of the sales price of the property. It is not based on the seller’s gain. It may be substantially more than the actual tax due. We can assist you in obtaining a refund. There is no fee if there is no refund. Submit your application today.
Withholding tax laws have changed and increased for 2016.
The withholding tax rate has increased to 15% of the amount realized on the disposition of a US real property interest by a foreign person on or after February 16, 2016
- The foreign person transfers (by sale, exchange, gift, or any other disposition) a US real property interest to an INDIVIDUAL and realizes US$300,000 or less (in most cases the sales price) AND the property is acquired by the individual for use as a residence, then no sums need to be withheld or submitted. Please note there are important specific requirements regarding residential use by the individual acquiring the property.
- The foreign person transfers a US real property interest and the amount realized is more than US$300,000 but does not exceed US$1,000,000 AND the property is acquired by the transferee for use as a residence, then the withholding tax rate is reduced to a withholding tax rate of 10%.
If the foreign person transfers a US real property interest and the amount realized exceeds US$1,000,000, then the withholding tax rate is increased to 15% of the amount realized regardless of the intended use of the property.
Please note that the buyer or other transferee of a US real property interest, and a corporation, qualified investment entity, or fiduciary that is required to withhold tax, must file form 8288 to report and transmit the amount withheld.
Your situation may have different withholding tax consequences depending upon the specific facts surrounding the disposition. For more information regarding your specific situation, please review the instructions to form 8288 generally found on the IRS website, www.irs.gov, or contact us or a competent professional advisor of your choice for a personal consultation.
PLEASE NOTE THE WITHHOLDING TAX MAY BE SUBSTANTIALLY MORE THAN THE ACTUAL TAX DUE.
Contact Us To Obtain A Refund.