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ITIN Guidance for International Owner/Investors

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Services for Real Estate Pros with d/b/a TAMCO Capital Accounting & Finance BK #3055515

When real property interests are relinquished by persons who are nonresidents, they must apply for a U.S. Individual Taxpayer Identification Number (ITIN). An ITIN can be used in place of a Social Security Number (SSN) to request reduced tax withholding from the sale of U.S. property interests and to pay IRS required withholding from the sale of U.S. property interests to a foreign person. In effect, an ITIN is a legitimate Taxpayer Identification Number for foreign persons with a U.S. tax filing obligation. 

Pursuant to Treasury Decision 9082 (effective November 4, 2003), buyers are defined as "transferees" and sellers are "transferors."  Transferees and transferors of U.S. real property interests must provide an ITIN to complete a withholding tax return, apply for a withholding certificate, to file a notice of non-recognition, or when making certain elections under sections 897(i) as a seller.

Section 1445 requires that property transferees complete collect and remit tax withholding to the IRS (Forms 8288); and file a statement of withholding on a sale to foreign persons to FIRPTA (Form 8288-A).

Transferors who want to reduce or waive the FIRPTA withholding amount must have an ITIN to file an application for withholding certificate (Form 8288-B) when they sell U.S. property interests. A transferor or transferee may attach Form 8288-B to an ITIN application (Form W-7) before mailing to the IRS's Austin Service Center.

When real property interests are relinquished by persons who are nonresidents, they must apply for a U.S. Individual Taxpayer Identification Number (ITIN). An ITIN can be used in place of a Social Security Number (SSN) to request reduced tax withholding from a property sale and pay IRS required withholding. In effect, an ITIN is an acceptable Taxpayer Identification Number for foreign persons. 

Pursuant to Treasury Decision 9082 (effective November 4, 2003), buyers are defined as "transferees" and sellers are "transferors."  Transferees and transferors of U.S. real property interests must provide an ITIN to complete a withholding tax return, apply for a withholding certificate, to file a notice of non-recognition, or when making certain elections under sections 897(i) as a seller.

Section 1445 requires that property transferees complete collect and remit tax withholding to the IRS (Forms 8288); and file a statement of withholding on a sale to foreign persons with FIRPTA (Form 8288-A).

Transferors who want to reduce or waive the FIRPTA withholding amount must have an ITIN to file an application for withholding certificate (Form 8288-B) when they sell U.S. property interests. A transferor or transferee may attach Form 8288-B to an ITIN application (Form W-7) before mailing to the IRS's Austin Service Center.

Our firm is BBB certified and based in the Orlando, FL metro area. Real estate brokers, settlement agents, real estate attorneys, and other allied pros are invited to book an on-site CAA. There is no cost to the scheduling party and you can book up to four hours per week based on availability. 

As a federally authorized enrolled agent, I also represent taxpayers before the IRS and prepare missing personal and business tax returns. Our accountants are certified in QuickBooks Online and can help clean up company books and records regardless of software. On-site CAAs serve Osceola, Orange, and Seminole County offices located within a one hour's drive from our Central FL headquarters in Hunter's Creek. Give me a call at (407)403-6705 for more information or visit us online at www.reciprocaladvisors.com/ITIN.

 

 

 

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