Unlike other areas of the country, Cape Coral is full of foreign property owners. Some have bought vacant lots that they plan to eventually build a home on and retire in this area. Yet, others have bought the lots for cheap as a long-term investment or quick flip. We also have many foreign clients who own a home here in Cape Coral as a second home, vacation home, or income property. Either way, at some point there comes a time when the foreign property owner is ready to sell their investment. But, there are some very important factors to consider when selling a property in the United States as a foreign owner. Here we will discuss FIRPTA and Foreign Owners in Cape Coral.
One of the most important things to consider is FIRPTA. Are you a foreign property owner or investor? If so, it is important to understand FIRPTA and what that means when you sell a property here in the United States.
What does FIRPTA mean?
FIRPTA stands for the Foreign Investment in Real Property Tax Act. Back in the 1980’s, the US government instituted a withholding tax at the time of sale when the property is owned by a foreign person. The tax code requires buyer’s to withhold up to 15% of the gross sales price if the seller is a nonresident alien, foreign corporation, foreign partnership, foreign trust, or foreign estate.
Additionally, foreign investors are given a Taxpayer Identification Number (TIN) to pay taxes or to file for withholdings on properties they buy and sell in the US.
Are there exceptions?
Yes, there are some exceptions to FIRPTA withholding. In some instances, no withholding is required or only a 10% withholding is required.
FIRPTA Experts
Lastly, here at Cape Coral Lots, we have worked with clients from all over the world to help them sell their properties here in Cape Coral. We are very familiar with the FIRPTA process but we as realtors are not responsible for filing the paperwork. FIRPTA is always changing and there are experts out there who handle the paperwork and know all the ins and outs of the law. That is why it is important to hire an expert in the field of FIRPTA. If you are a foreign seller, you need someone with knowledge and experience to guide you through the FIRPTA process. We highly recommend contacting Julie Lepore, President and owner of Total Firpta LLC. Below is her contact information:
Julie Lepore
President & Owner
Total FIRPTA LLC
O: 239-266-8516
M: 239-281-6883
Sources:
National Association of Realtors: https://www.nar.realtor/foreign-investment-in-real-property-tax-act-firpta
Total FIRPTA LLC: https://totalfirpta.com/
