FIRPTA / international seller?

[pinkxray]

Ok. I have no idea what this means?

I just found out our seller is international. First American just sent me an email about FIRPTA forms and extra taxes for international sellers.
Is this just extra forms? Aren’t the taxes on the buyer?
and why am I just finding out about this being an international buyer a month and half into the process?

 

[princesscinderella]

It’s not a big deal just make sure the closing agent withholds the taxes at closing to be paid to US government. It becomes your responsibility because you are the US citizen and therefore easier to track down.

 

[MICKIMINI]

Your broker was not upfront with you! Taxes are on the seller. The IRS letters (I've received a few) have stopped me in my tracks, but they are just confirmation (in my cases) of the foreign seller.

You have to supply your SS# just in case the seller doesn't pay, they know who the buyer is. We've done it a couple times and it hasn't been a big deal. Bad on the broker for not telling you!

 

[supersnoop]

Taxes are on the seller, but withholding is the responsibility of the buyer. It's kind of like how you have to pay your income taxes, but your employer is required to withhold and remit some to the IRS on your behalf. The title company should take care of that for you and send you the forms.

It's technically you're responsibility to send part of your payment to the IRS instead of giving it to the seller. You'll get an IRS Form 8288 from the closing company to prove you fulfilled your obligation. I've got one sitting on my desk from a contract I purchased last month.

 

[DisneynBison]

Your broker was not upfront with you! Taxes are on the seller. The IRS letters (I've received a few) have stopped me in my tracks, but they are just confirmation (in my cases) of the foreign seller.

You have to supply your SS# just in case the seller doesn't pay, they know who the buyer is. We've done it a couple times and it hasn't been a big deal. Bad on the broker for not telling you!

It has nothing to do with the broker not being upfront with them. The buyer just didn't research and ask the right questions. A buyer needs to go in with eyes wide open and make sure they have researched the transaction possibilities to ask the correct questions. There are many, Is the seller in Bankruptcy?, Is this contract have anything to do with a divorce? Does this contract have anything to do with a death? Is this seller from a foreign country?.............

On one contract I asked and had it written in the contract that the seller was aware and responsible for FIRPTA and that it would be withheld and submitted (don't remember the exact wording) at closing.