When you sell your United States rental or investment property, the Internal Revenue Service recognizes this sale as a taxable event. By federal law, the Internal Revenue Service requires the seller to withhold 10% of the selling price as assurance that you will pay your federal income tax.

The most common way to receive part of this money back is to file a 1040NR Non-Resident Alien Individual Tax Return. Since your tax year ends on December 31st, your tax return won’t be prepared until March or April of the following year. Obviously, this causes an unpleasant hardship because you would have to wait between four months to sixteen months to receive the withheld funds.

Here’s were we can help. The Internal Revenue Service provides you a prevision to shorten the time period that you can receive your withheld funds. By filing for a withholding certificate before you close on your property, the title company will have adequate documentation to hold your 10% in an escrow account instead of sending it Internal Revenue Service. Once we’ve filed the certificate, the Internal Revenue Service will issue its response.
If approved, you could receive the funds being withheld in the escrow account in three to four months.

Click here to print the form we’ll need to get you started

We’ll also help you with your US Tax planning needs
Click here for example analysis on the tax Gain on sale of property