👋 Exemption from FIRPTA Withholding
(Not Every Foreign Seller Is Subject to FIRPTA Withholding)
If a foreign national seller qualifies for an exemption from FIRPTA withholding:
✅ No FIRPTA withholding is retained at closing
✅ No FIRPTA withholding funds are remitted to the IRS
✅ The parties avoid unnecessary withholding and refund procedures
✅ A written FIRPTA Exemption Opinion may be provided for inclusion in the closing file.
Many buyers, sellers, Realtors, attorneys, and closing agents assume FIRPTA withholding is automatically required whenever a foreign national is involved in a real estate transaction.
That assumption is not always correct.
In certain circumstances, a seller may qualify for an exemption from FIRPTA withholding requirements.
👉 Important Distinction
A FIRPTA Withholding Certificate Application assumes FIRPTA withholding applies and seeks IRS approval to reduce or eliminate the withholding amount.
A FIRPTA Exemption Analysis determines whether FIRPTA withholding is required in the first place.
🧠 Specialized Analysis Required
Determining whether an exemption applies is a specialized professional service requiring significant professional analysis and judgmen
⚖️ Professional Responsibility Matters
A determination that FIRPTA withholding is not required carries significant professional responsibility and should not be based upon assumptions or incomplete information.
Each matter must be evaluated individually based upon its own facts and circumstances.
💼 Consultation Policy
Because exemption determinations frequently require significant preliminary consultation and analysis, an initial consultation fee may apply.
The consultation fee is fully credited toward FIRPTA services subsequently performed by FPG for the transaction.
If FPG is not engaged to perform FIRPTA services for the transaction, the consultation fee is non-refundable.
Not every exemption involves the Substantial Presence Test.
👉 FIRPTA exemptions and exceptions.
👉 FREE CONSULT - Speak with a FIRPTA Specialist