If your property manager isn't doing this, they could have a problem. Feel free to call me if you need to switch. We specialize in condos and deal with a lot of overseas buyers by helping them purchase and then managing. We are also based in MetroWest. See our site at http://condometropolis.com
Here is the advice I received from my overseas CPA specialist:
"When a foreign national earns US source income, they are subject to 30% withholding tax (unless otherwise specified by an income tax treaty). As a property manager, you are responsible for withholding 30% of the gross rents and submitting it to the IRS each month. If you do not withhold, you can be fined up to $10,000 by the IRS.
If the foreign national provided you with a properly filled in and executed Form W-8ECI declaring that they have made the election to file annual income tax returns, you donâ€™t have to withhold the 30%. The W8-ECI form must include their US ITIN.
At the end of each year, you are required to report to the IRS the gross rents collected on Form 1042-S (for foreign nationals) and Form 1099 (for US citizens). A copy of the form is sent to the taxpayer. They must match that income on their annual tax return.
A foreign national will make the election to file an annual income tax return reporting their net income with the filing of their tax return for the year in which they purchased the rental property.
When they sell their property, as you know, they are subject to a 10% withholding of the gross sales price. (unless reduced or eliminated by the IRS with a Withholding Certificate).
You can get any of the above listed forms from the IRS website at http://www.irs.gov