I am in the process of selling one of my contracts, and the FIRPTA tax is 10% of sale amount, not the profit, you can then apply through an accountant to get the difference back, however, they charge about $500 to do this for you.
So unless your selling a reasonably high points contract it will not be worth it. I think you would also may need a tax id to get it back, but I'm not 100% sure of this as I already have one of these.
Paul
Thanks for that, Paul, although it's not great news.
I have checked this out as far as I can on Google, and it does look like all the tax websites do specify that FIRPTA is applicable to the GAIN and not to the sale amount, which would be in keeping with what the Disney "Notary Public" told me in December.
For example, one of many definitions as follows:-
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Definitions of Foreign Investment In Real Property Tax Act (FIRPTA)
* A federal law that subjects nonresident aliens and foreign corporations to U.S. income tax on their gains from the disposition of an interest in real property. This definition of Foreign Investment In Real Property Tax Act (FIRPTA) contributed by gulf-coast-associates
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I wouldn't mind if it is on the GAIN as that seems reasonable, but if it is on the total sum, it does seem unfair. For example, if I were to buy a villa at $100,000 and sell it one month later for the same price, I don't know how they could reasonably charge $10,000 tax on the sale. Then again, whoever said that taxes should be reasonable?!?
Seems that governments around the world just love thinking up new ways to take money off us!
Anyway, as I said, I'll keep this in mind through the sales process.