Foreign Investment in U.S. Real Estate
Nonresident foreign individuals and entities investing in U.S. real estate are generally subject to 15% withholding tax on real estate dispositions. Dispositions subject to FIRPTA are sales, gifts and transfers to business entities, just to name a few. The 15% withholding is levied on the sale price or disposition value. The withholding applies even if a property is being sold at a loss or if it is being transferred to a business entity and no money is changing hands.
Like with most things involving the IRS, failure to comply can result in steep penalties.
There are a few exceptions to FIRPTA, including options that can reduce or eliminate withholding, and we know all of them. Esquire Group has assisted numerous clients with their FIRPTA transactions giving us the expertise to effectively assist you with your FIRPTA matter.
Esquire Group will evaluate your U.S. real property transactions, determine FATCA applicability, when possible, propose strategies to reduce or eliminate the effects of FIRPTA, and ensure proper reporting.