Getting ahead of the FIRPTA process can help reduce the amount of money you owe at the closing table. Marina Parkin (Koontz & Parkin, CPAs) and Jo Ann Koontz (Koontz & Associates, PL) explain how important the timing of your closing is so you know when to pay FIRPTA tax and how to get the payment back.
1:46 What is FIRPTA? What are the most recent changes in 2021?
4:05 FIRPTA is not a penalty. Reducing tax from 15% to 10%.
9:48 Price is under $300,000.
12:28 Remit the 10% or 15% withholding at closing.
16:20 Calculating gain of transaction.
18:40 Withholding certificate.
23:59 Why not use withholding certificate?
30:28 ITIN and withholding certificate.
35:20 Connect with attorney when you get the foreign seller's listing.
37:14 Defining the foreign person. What type of tax return are they filing in the US?
41:38 What if foreign person has formed an LLC?