The Miami Beach Aquatic Center and Park, designed by Brooks + Scarpa, transcends the traditional concept of a sports or recreational facility. It presents itself as an ambitious multifunctional
FIRPTA INFORMATION
Dated: August 4 2022
Views: 58
What is FIRPTA?
It's the Foreign Investment in Real Property Tax Act of 1980. It is a tax law that applies to foreign persons who are disposing of U.S. property.
Who does FIRPTA affect?
FIRPTA affects all non resident aliens and foreign companies not considered to be American corporations. From a taxation (tax return) standpoint, when a person who doesn't live in the United States or when a foreign corporation sells a property in the United States, they shall be subject to FIRPTA provisions.
How does FIRPTA it affect buyers and sellers?
At the time of closing, buyers are required to withhold 15% 15%. For example, a foreign investor sells a property for $400,000 (USD). The closing agent of the transaction (the company or lawyer that processes the title deed) will retain 605,000 (USD) in a special escrow account, until the foreign investor presents his federal income tax return in January of the next calendar year following the closing of the sale.
What is the difference between “withholding tax” and “tax?”
Withholding tax is the mechanism whereby the IRS forces the foreign individual or company to submit their tax return to determine if a profit or a loss resulted from the transaction.
Once the tax return is submitted and the IRS determines the amount to be charged as tax, the difference between the withholding tax and the tax is returned to the seller.
Can this withholding be avoided?
It's very important to properly plan this out to avoid negative surprises at closing.
Buying under your name or through a company is one of the most important elements in the application of FIRPTA. However, the type of legal structure and the internal makeup could make a difference. On the other hand, FIRPTA is only one of the factors that should be taken into consideration, so it's extremely important you know the advantages and disadvantages of the different purchasing structures (LLC, S Corp, Trust, Corporation, etc.).
How does it affect the buyer?
As a buyer, you should make sure the withholding tax is implemented in case the seller is a non resident alien or a foreign company not considered a U.S. corporation. If you don't make sure it's implemented, you may be responsible for paying the taxes.
On the other hand, as a buyer, it's important to make sure you create the most effective purchasing structure to deal with this withholding tax for a future sale.
LEGAL NOTICE:
The provisions of FIRPTA are complicated and require the expertise of a real estate lawyer or public accountant. They can fill out the proper forms and evaluate the possible implications. The information provided herein should not be considered a source of legal or financial advice. Please contact a professional in your area to receive information and guidance that applies to your individual situation.
Si le interesa más información sobre invertir en Miami y Orlando, Florida, cómo obtener un crédito hipotecario, conocer más de la estructura legal, tributaria, y sucesora en una inversión inmobiliaria, comunícate conmigo por WhatsApp o agenda una cita conmigo hoy!
Jester Nino
Jester's primary objective is to enhance your real estate journey and optimize your return on investment.With the support of an exceptional team, Jester Nino strives to surpass customer expectations a....
Latest Blog Posts
El Miami Beach Aquatic Center and Park, diseñado por la firma Brooks + Scarpa, trasciende la concepción tradicional de un centro deportivo o recreativo. Se presenta como un ambicioso
1. Global Financial Hub (Beyond the Obvious Data)Ecosystem Depth: Brickell isn’t just home to corporate HQs but an entire infrastructure of complementary financial services (international law
1. Global Financial Hub (Beyond the Obvious Data)Ecosystem Depth: Brickell hosts not only corporate HQs but also complementary financial infrastructure (international law firms, consulting groups,
Copyright © MFRMLS.com All information deemed reliable but not guaranteed. All properties are subject to prior sale, change or withdrawal. Neither listing broker(s) or information provider(s) shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless. Listing(s) information is provided for consumers personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Information on this site was last updated Last updated on September 27, 2026 4:12 AM UTC The listing information on this page last changed on Last updated on September 27, 2026 4:12 AM UTCd. The data relating to real estate for sale on this website comes in part from the Internet Data Exchange program of MFR MLS.
All information deemed reliable but not guaranteed. All properties are subject to prior sale, change or withdrawal. Neither listing broker(s) or information provider(s) shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless. Listing(s) information is provided for consumers personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing.
Updated on September 27, 2026 4:12 AM UTC
Copyright Southeast Florida Multiple Listing Service © 2026. Accuracy of listing information is not guaranteed. Listing information is provided for personal consumer, non-commercial use, solely to identify potential properties for potential purchase. All other use is strictly prohibited, is a violation of the terms of use, and may violate federal and state law.
Data Last Updated: September 27, 2026 4:15 AM UTC
