FIRPTA Withholding When a Foreign Person Sells Florida Real Estate

Published October 9, 2026 · Recalde & Friedman, PLLC

The basic rule

When a foreign person sells a U.S. real property interest, the buyer (the transferee) generally must withhold 15% of the amount realized, usually the gross sales price, and remit it to the IRS. The buyer is the withholding agent and can be liable if withholding isn't done (26 U.S.C. § 1445; IRS: FIRPTA withholding).

Exceptions and reduced rates for residences

• No withholding if the buyer is an individual who will use the property as a residence and the amount realized is $300,000 or less. "Residence" means the buyer or a family member has definite plans to live there at least 50% of the days it is in use during each of the first two 12-month periods after the transfer (IRS: Exceptions from FIRPTA withholding).
• 10% withholding applies instead of 15% when the buyer will use the property as a residence and the amount realized is over $300,000 but not more than $1 million (26 U.S.C. § 1445(c)(4)).
• Non-foreign certification: no withholding is required if the seller provides a certification of non-foreign status (with taxpayer ID) and the buyer has no actual knowledge it's false.

Withholding certificates

A foreign seller whose actual tax will be less than the withholding can apply to the IRS for a withholding certificate on Form 8288-B to reduce or eliminate withholding. The IRS states it normally acts on applications within 90 days after receiving a complete application. If the application is pending at closing, the withheld amount is typically held in escrow under the rules described by the IRS.

Paperwork at closing

The buyer reports and pays the withholding on Forms 8288 and 8288-A within 20 days after the transfer. The seller later claims credit for the withholding on their U.S. return.

Plan ahead

• Tell the closing team early if any seller is not a U.S. person, including foreign entities and trusts.
• Decide early whether to apply for a withholding certificate.
• Get tax advice. FIRPTA withholding isn't the seller's final tax; it's a prepayment.