IRS notice about my DVC purchase

[perchy]

So I closed Dec. 3, 2021 on an OKW contract I purchased from a UK seller. Today, I got an IRS notice about form 8288. The withholding should have been taken care of by Mason, right? I just need to get the form? Or maybe I already have it?

Walk me through this? The IRS makes me panic freeze.

 

[BWV Dreamin]

Is this in regards to FIRPTA? Contact your settlement company. They should have escrowed this and they need to pay it .

 

[supersnoop]

So I closed Dec. 3, 2021 on an OKW contract I purchased from a UK seller. Today, I got an IRS notice about form 8288. The withholding should have been taken care of by Mason, right? I just need to get the form? Or maybe I already have it?

Walk me through this? The IRS makes me panic freeze.

Did the title company have you sign a form that required your social security number?

The scary part is that the buyer is required to send money to the IRS. This money is supposed to be withheld from the seller's proceeds in case they owe US income taxes on the sale. They can file a form to get it returned if they don't owe it. The title company is suppose to handle this all for you. They should have provided you with a copy of the Form 8288 in your closing documents. I have one from my most recent purchase.

The fact that the IRS reached out to you is troublesome. That makes me worried that the title company might not have followed through. So, check your closing paperwork today, and call the title company on Monday.

 

[we"reofftoneverland]

So I closed Dec. 3, 2021 on an OKW contract I purchased from a UK seller. Today, I got an IRS notice about form 8288. The withholding should have been taken care of by Mason, right? I just need to get the form? Or maybe I already have it?

Walk me through this? The IRS makes me panic freeze.

Get it taken care of quickly because the IRS is packing heat now. Lol

FYI we have purchased from an international seller and never got a letter from the IRS, so it is not normal to get one.

 

[drusba]

This is a FIRPTA issue. See my explanation of the FIRPTA issue in this thread, posting no. 6: https://www.disboards.com/threads/international-seller-delayed-closing.3706710/#post-59749298

This is something that should have been taken care by the broker or closing company, but it sounds like that may not have occurred with the result that you could now be liable to pay the IRS 15% of the sale price unless those you dealt with fix this problem

 

[Cyberc1978]

I’m international and I have sold a few contracts a few years back.

Both times and especially during Covid IRS was very very slow processing the paperwork so I could get some of my money back. During Covid the wait time was close to 10 months.

I’m sure Mason have withheld the funds. I don’t know if the IRS still have a backlog of cases to process but it might explain why you got the letter from the IRS.

 

[lexxus379]

I also got a letter yesterday from my purchase last Dec as well. I checked my closing docs and we have the form that authorizes them to withhold the taxes. Sent an email to closing company, hoping it’s a quick fix.

 

[DVChris]

I received a letter last week from the IRS stating they received payment and the matter is now closed. It was for a contract that I purchased in December 2021. I've purchased a few more contracts from international sellers so I am expecting to receive the same letters next year, assuming Cammy took care of the filing and payment correctly.

 

[sndral]

My non expert reading of 8288 is that international sellers can either have the 15% sent to the IRS & then file for a refund if they owe less or they can apply for a certificate in which case the escrow company holds the 15% until the IRS calculates what’s owed & then the escrow co. sends the IRS its’ share & the seller the rest. Hopefully these several months later notices are cases were the international sellers elected to apply for the certificate & the IRS just got around to issuing or denying it & the money that’s been sitting in escrow now needs to be sent by the escrow co..

 

[Minniesgal]

I’m international and I have sold a few contracts a few years back.

Both times and especially during Covid IRS was very very slow processing the paperwork so I could get some of my money back. During Covid the wait time was close to 10 months.

I’m sure Mason have withheld the funds. I don’t know if the IRS still have a backlog of cases to process but it might explain why you got the letter from the IRS.

This we waited over a year for ours it may be the forms have been filed but not processed yet.


Most UK sellers get the whole amount back so once sorted it is unlikely there will be anything to pay.

 

[perchy]

I emailed Cammy this morning. She said:

“The IRS letter is only an FYI and no action required by you.



The FIRPTA tax agent has also received the letter and will be completing the final forms for us to release the funds accordingly.”

 

[CarolMN]

I emailed Cammy this morning. She said:

“The IRS letter is only an FYI and no action required by you.



The FIRPTA tax agent has also received the letter and will be completing the final forms for us to release the funds accordingly.”

Well, that's good news. Hope it eases your mind.

 

[littlemichelle16]

I also got this letter for a closing January 2022 with an international seller. Unfortunately my contacts for my purchase first stated the title company doesn't handle this... I pushed back and then they stated the attorney filed it and he is good at his job so they are sure it is all set. I asked for confirmation that all items listed in the letter (including the $ due) were sent and mentioned the fees and penalties. They eventually asked the attorney who basically said it is all set. So...better be all set. Hopefully this is just a training issue but I was disappointed in the service I received.