Withholding Requirement

The disposition (sale/transfer) of US real property by a foreign person is subject to the Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) 15% withholding against any tax that might be due. An IRS disposition includes but is not limited to a sale or exchange, liquidation, redemption, gift, transfers, etc.

Persons purchasing US real property from foreign persons are required to withhold 15% of the amount realized on the disposition.