How much is FIRPTA withholding when a foreigner sells US property?

Generally 15% of the gross sale price. It drops to 10% for a buyer-occupied residence priced $300,001 to $1,000,000, and to 0% for a buyer-occupied residence priced $300,000 or less.

Is FIRPTA withholding the same as the tax I owe?

No. It is a prepayment against your actual tax. Your real liability is computed on the gain (capital-gains rates, plus the 3.8% net investment income tax where applicable), and any excess withholding is refunded when you file.

How can I reduce FIRPTA withholding?

Apply to the IRS for a withholding certificate on Form 8288-B, ideally at least 90 days before closing. If approved, withholding is reduced toward your actual tax on the gain.

Do I still owe FIRPTA if I sell at a loss?

Withholding can still apply, because it is based on the gross sale price rather than gain. You would then reclaim the over-withheld amount by filing a US tax return, or reduce it in advance via Form 8288-B.

Do states withhold tax too?

Yes, some do, for example California (3.33% of gross, or 12.3% of gain), New York (via Form IT-2663), Hawaii (7.25%), and Maryland (8%). Florida and Texas have no state income tax and no equivalent withholding.

How long does it take to get a FIRPTA refund?

File Form 1040-NR for the year of sale and claim the withholding as a credit. Refunds for non-resident returns commonly take four to six months, and you must have an ITIN (via Form W-7) to file.

FIRPTA Explained: What Foreigners Pay in Tax When Selling US Property (2026)

Published on: July 10, 2026

Last verified: 10 July 2026. US federal and state tax rules change. Verify before acting.

If you are a non-US person selling US real estate, one rule dominates the closing: FIRPTA, the Foreign Investment in Real Property Tax Act. Under it, the buyer is generally required to withhold 15% of the gross sale price and send it to the IRS. The number that surprises most sellers is not the rate, it is that it applies to the gross price, not your profit. Sell a property for