Home Selling in Florida>Question Details

Tamara, Home Seller in Florida

I am a Canadian citizen. I purchased a condo in 2003 and have been living in it full time since then. I have

Asked by Tamara, Florida Sat Apr 19, 2008

applied for permanent status but nothing yet. I have a Canadian passport, an SS number and a temporary Florida Driver's license, valid for 1 year. Would the title company hold any tax money at closing (This Firpta mentioned here for example)?

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Hi Paula,

Just wanted to let you know that I've read the IRS publication 519 as you suggested and both my husband and I are clearly resident aliens under their "substantial presence test".

I was also reading up about firpta and the IRS states that it is for a house valued at more than $300,000 which mine is not anywhere near.

When I receive the name and number of your contact I'll call to confirm that my worse fears have been put to bed.

I truly appreciate the time you donated in responding to me.

Sincerely,

Tamara
1 vote Thank Flag Link Tue Apr 22, 2008
Hi Paula, you can contact me at enigme33319@netzero.net

Thanks!
1 vote Thank Flag Link Mon Apr 21, 2008
Hi Paula,

Yes the 10% is important given that I want to purchase a house with the proceeds of the sale and will need the money. Basically, I just want to do what I did the last time, sell one place to buy another.
1 vote Thank Flag Link Sun Apr 20, 2008
Tamara,

first I should say that realtors like me are not allowed to give legal advice; we are neither licensed nor trained to practice law (or accounting, for that matter). That said, I know from experience that FIRPTA does not apply in every case. It depends on the selling price and if the property will be the buyers' full-time residence. In addition you or your accountant/CPA can possibly file for zero-withholding. Consult with a good CPA/accountant. I can name at least one if you are interested (full disclosure: I have no connection or affiliation with that CPA).

All the best,
Tobias Kaiser, MS, CIPS
1 vote Thank Flag Link Sat Apr 19, 2008
Glad I could be of help!

Get in touch with my financial advisor I sent you to make sure that all is well, but I think it is.

When you get ready to sell your property, let me know and I'll put you in touch with a great agent to help you do that!

Best Regards,

Paula Bean
0 votes Thank Flag Link Tue Apr 22, 2008
well, there are many ways to make that happen as well ;-) send me your email address direct and I'll cover them with you. We need a plan A and a plan B: If you have to use the firpta 10% withholding or not.

there are always creative ways to purchase without worrying over 10%, but you need to feel comfortable with how this is done. I will have more news soon, hang in there!
0 votes Thank Flag Link Sun Apr 20, 2008
Tamara,

I'll have an answer tomorrow, apparently they went off on a cruise where there is no cell phone access!
How rude that they did not invite me along! lol!

It is not a new law, and the Title co. you closed your other condo with should have verified your citizenship status. It is complicated - so hang in there for another day and I'll get you an answer.

I'd still like to know if you have to withhold the 10% if that will break the deal? Is it that important? If so, why? Once I know the answer to that, I may have other advice for you to work it out.

I'll be in touch tomorrow, in the meantime, send me your direct email. for some reason I'm getting your email hours or days after it is posted. Not sure it is a Trulia server issue, or on my end, but send to paulabean@homeOrlando.com.

I will follow up with a post on Trulia to update all as well.

;-) Paula
0 votes Thank Flag Link Sun Apr 20, 2008
Thanks everyone for answering and Paula I am very interested in what your friend at the Title Company will say, especially in terms of what I could expect at closing. My confusion about all this comes from the fact that this is actually my second Florida condo I would like to sell. When I sold the first one in 2003, the Title Company never asked if I was a US Citizen or nothing except if I had lived in the Condo for at least 5 years, which I had, and if I was using the money to purchase a new primary residence, which I was, so the Title Company never withheld anything. I was working through my S corp at the time and did tax returns but I'm pretty much retired now so I haven't had any income to report lately. Is this a new law the 10% withholding or am I missing something?
0 votes Thank Flag Link Sat Apr 19, 2008
Tamara,

Probably so since you are not a U.S citizen, BUT, I have access to a good friend who is a closing agent and works for an atty. I've put a call in to her to see what her .02 is.

Would it prevent you from selling your condo if they withhold the 10%? The worst that could happen is that you'll get it back when you file taxes, which could be as early as Jan 2009, or when you get your permanent status, whichever comes first.

I'll post again when I hear back from my legal Eagle ;-)

Paula Bean
0 votes Thank Flag Link Sat Apr 19, 2008
Tamara, as far as I know, they should hold 10% until you pay your taxes.
To prevent foreign sellers from avoiding the payment of taxes due on the sale of real property, the IRS requires that 10 percent of the gross sale price (including cash paid and any debt assumed by the buyer) is held from the seller.
There are a few exceptions to this rule, you should consult the IRS and/or and accoutant about it because tax laws are constantly changing.
Web Reference: http://www.miamism.com
0 votes Thank Flag Link Sat Apr 19, 2008
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