FIRPTA Compliance / FIRPTA Forms

As a title or escrow agent, you have many FIRPTA compliance forms to complete and tasks to perform to meet FIRPTA compliance.

FIRPTA Compliance Risks

Errors made in completing the forms and performing the tasks can have very serious consequences:

  • You may be held liable for the withholding tax (10% or 15%), and your agency may have to pay that amount after the fact. If the IRS deems the failure intentional, it can also impose a penalty of 100% of the withholding.
  • If you fail to identify that a deceased non-resident was on title, and you release the sale proceeds without IRS clearance:
    • The transaction may later be subject to the IRS’s automatic estate tax lien that arises at the moment of death and can remain attached to the decedent’s gross estate for up to 10 years, even if no public notice was ever recorded.
    • If the estate tax was due and unpaid, the IRS can enforce the lien, and you (not your agency) can be held personally liable for the unpaid estate tax.

FIRPTA GLOBAL Requirements: Compliance Forms & Tasks

Before Closing, We Will Need:

  • Completion of the preliminary HUD-1 Settlement Statement.
  • Name, address, phone number, and SSN for each buyer.
  • Confirm with the buyer(s) whether they intend to use the property as their personal residence. If so, will they sign an affidavit (Intent to Reside Statement), stating that intent?

Upon Closing, We Will Need:

  • Purchase and sale agreement executed and signed by both buyer(s) and seller(s).
  • Form 8288 signed and dated by the buyer(s). This must be submitted within 20 days of the property transfer.
  • If the seller is eligible for an exemption or reduction of the statutory withholding amount of 15% and is applying for a withholding certificate, Form 8288-B must also be completed. If the application is for a reduction, a calculation of the expected capital gains tax must also be included.
  • Affidavit signed by the buyer(s), if the intent is to use the property as a personal residence.
  • Final HUD-1 Settlement Statement.
  • A copy of the check issued to the IRS, or a wire payment confirmation receipt.
  • A copy of the FIRPTA package submission tracking to the IRS.
  • For Hawaii properties:
    • a copy of forms N-288 and N-288A
    • a copy of the FIRPTA package submission tracking
    • a copy of the check submitted for HARPTA payment
  • For California properties:
    • a copy of Form 593 for all sellers
    • a copy of the FIRPTA package submission tracking
    • a copy of the check submitted to California FTB (Franchise Tax Board)
  • For other states that have applicable withholdings:
    • a copy of state withholding forms for all sellers
    • a copy of the tracking of the FIRPTA package
    • a copy of the check submitted to the state department.

FIRPTA Package Submissions

The following items must be sent to the IRS by either mail or courier within 20 days of closing:

  • Form 8288 signed and dated by the buyer(s)
  • Form 8288-A (Copy A and Copy B) for each seller
  • Form 8288-B, if applicable (see above)
  • a check or wire payment confirmation receipt, payable to the U.S. Treasury for the FIRPTA amount, with sellers’ names and, if applicable, their ITINs or SSNs.

Mail (USPS):
Ogden Service Center
Ogden, UT 84409

Courier:
Internal Revenue Service
1973 Rulon White Blvd.
Ogden, UT 84201

Are You Overwhelmed Yet?

Dealing with FIRPTA compliance tasks and completing all the required forms isn’t something you would likely be comfortable with or happy to do. Furthermore, you may be exposing yourself to significant financial risk.

Fortunately, You’re Off the Hook!

We have many years of experience with FIRPTA compliance requirements, including completing all relevant FIRPTA forms.

As Certified Acceptance Agents, we can also help the sellers obtain an ITIN (Individual Taxpayer Identification Number) in an expedient manner.

We will also prepare the required U.S tax return for non-resident sellers to report and calculate the capital gain (if any) on the sale of the property.

Doesn’t that help you breathe easy.

Let FIRPTA GLOBAL Handle Your FIRPTA Needs

Our services can be provided virtually or in person. Contact us to start the process!

Edit Template
Book a
Consult