Form 8288-b when to file

Real Property Interests Form B is used in situations where you are applying for an exemption or reduction from the prescribed withholding rates on the sale price of the property. Asif provided exceptional service. He did our U. He made things easy to understand, was unbelievably fast 24 hours and gave clear and concise direction as to what to expect for our refunds, IRS timelines, etc.

Would highly recommend. Asif was highly knowledgeable, incredibly professional and worked toward effective solutions to a couple glitches we ran into with the sale of our U.

His instructions were clear and concise, there were no questions what we needed to do to finalize the paperwork. The process was incredibly easy and seamless. Would highly recommend this company for your tax needs. I was in need of a tax specialist who could help me with a U. Not having much luck in finding someone in Toronto, I searched the internet and found Platinum Books and Tax.

It was enacted in the year as part of the U. A foreign seller of U. The adjusted basis is generally the original cost to purchase the property plus the additional cost of any improvements less any depreciation on a rental property. The seller is also allowed to decrease the gain on sale by certain selling costs.

Foreign investors are often interested in what U. Due to the time required for the IRS to process the application, the Form B should be filed at least 90 days prior to the closing date of the sale.

Government within 20 days of the closing date of the sale. The following is a basic example. A foreign investor purchases U. The property is held as a rental property. The foreign investor sells the U. For this example, it is assumed that the gain is sourced to a state that does not impose tax on the gain. If the foreign seller is a foreign corporation that owns the U. But if you do, and it is later determined that the transferor is a foreign person, the withholding tax may be collected from you.

These amounts must be reported and transmitted to the IRS by the 20th day following the date of each payment. Transferred property that is not a U. If you acquire an interest in property that is not a U. No withholding is required on the acquisition of an interest in a domestic corporation if a any class of stock of the corporation is regularly traded on an established securities market, or b the transferee receives a statement issued by the corporation that the interest is not a U.

If, after the date of transfer, you receive a notice indicating that the statement is false, see Late notice of false certification , earlier. Generally, no withholding is required on the acquisition of an interest in a foreign corporation.

However, withholding may be required if the foreign corporation has made the election under section i to be treated as a domestic corporation. You may receive a notice from the transferor signed under penalties of perjury stating that the transferor is not required to recognize gain or loss on the transfer because of a nonrecognition provision of the Internal Revenue Code see Temporary Regulations section 1.

No particular form is required for this notice. By the 20th day after the date of transfer, you must send a copy of the notice of nonrecognition with a cover letter giving your name, address, and identification number to:. See Regulations section 1.

A notice of nonrecognition cannot be used for the exclusion from income under section , like-kind exchanges that do not qualify for nonrecognition treatment in their entirety, and deferred like-kind exchanges that have not been completed when it is time to file Form In these cases, a withholding certificate issued by the IRS, as described next, must be obtained.

A withholding certificate may be issued by the IRS to reduce or eliminate withholding on dispositions of U. Either a transferee or transferor may apply for the certificate. The certificate may be issued if:. The transferor is exempt from U. The transferee or transferor enters into an agreement with the IRS for the payment of the tax. An application for a withholding certificate must comply with the provisions of Regulations sections 1.

You can find Rev. In certain cases, you may use Form B to apply for a withholding certificate. The IRS will normally act on an application by the 90th day after a complete application is received. If you receive a withholding certificate from the IRS that excuses withholding, you are not required to file Form However, if you receive a withholding certificate that reduces rather than eliminates withholding, there is no exception to withholding, and you are required to file Form Attach a copy of the withholding certificate to Form See When To File , earlier, for more information.

Withholding is not required if the amount realized by the transferor is zero for example, the property is transferred as a gift and the recipient does not assume any liabilities or furnish any other consideration to the transferor. No withholding is required with respect to any amount realized by the grantor on the grant or lapse of an option to acquire a U. However, withholding is required on the sale, exchange, or exercise of an option.

If the property is acquired by the United States, a U. For rules that apply to foreclosures, see Regulations section 1. If a distribution from a domestically controlled qualified investment entity is treated as a distribution of a U. See section h 5. You may be eligible for relief for a late filing if a statement or notice was not provided to the relevant person or the IRS by the specified deadline and if you have reasonable cause for the failure to make a timely filing.

Once you become aware that you have failed to timely file certain certificates or notices, you must file the required certification or notice with the appropriate person or the IRS. Also include the following. An explanation describing why the failure was due to reasonable cause. Within the explanation, provide that you filed with, or obtained from, an appropriate person the required certification or notice.

For more information, see Rev. See Late notice of false certification , earlier. A person is not treated as an agent if the person only performs one or more of the following acts in connection with the transaction:.

Functioning exclusively in his or her capacity as a representative of a condominium association or cooperative housing corporation. This exemption includes the board of directors, the committee, or other governing body. Withholding is required on certain distributions and other transactions by domestic or foreign corporations, qualified investment entities, trusts, and estates.

Certain domestic corporations are required to withhold tax on distributions to foreign shareholders. No withholding is required on the transfer of an interest in a domestic corporation if any class of stock of the corporation is regularly traded on an established securities market.

Also, no withholding is required on the transfer of an interest in a publicly traded partnership or trust. No withholding will be required with respect to an interest holder if the entity or fiduciary receives a certification of nonforeign status from the interest holder. An entity or fiduciary may also use other means to determine that an interest holder is not a foreign person, but if it does so and it is later determined that the interest holder is a foreign person, the withholding may be collected from the entity or fiduciary.

A domestic partnership that is not publicly traded must withhold tax under section on effectively connected income allocated to its foreign partners and must file Form , and Form A publicly traded partnership or nominee generally must withhold tax under section on distributions to its foreign partners and must file Forms and S. Because a domestic partnership that disposes of a U. If a domestic trust or estate disposes of a U. The withholding must be paid over to the IRS within 20 days of the date of distribution.

Special rules apply to grantor trusts. Trusts with more than beneficiaries may make an election to withhold upon distribution rather than at the time of transfer. This election does not apply to any qualified investment entity or to any publicly traded trust.

Special rules apply to large trusts that make recurring sales of growing crops and timber. A foreign corporation that distributes a U. No withholding or reduced withholding is required if the corporation receives a withholding certificate from the IRS. The property is distributed in redemption of stock under section , in liquidation of the corporation under sections through , or with respect to stock under section that is not made out of the earnings and profits of the corporation.

No withholding is required under section e 4 , relating to certain taxable distributions by domestic or foreign partnerships, trusts, and estates, until the effective date of a Treasury Decision under section e 2 B ii and g. However, no withholding is required under section e 5 for dispositions of interests in other partnerships, trusts, or estates until the effective date of a Treasury Decision under section g.

The transferee may rely on the statement unless the transferee knows it is false or the transferee receives a false statement notice pursuant to Regulations section 1. A distribution made after December 17, , by a REIT generally is not treated as gain from the sale or exchange of a U.

If you are using Forms and A to meet the withholding, payment, and reporting requirements under new section f 1 , you must write Section f 1 withholding at the top of both Forms and A. For additional specific instructions related to the reporting of section f 1 withholding, see Notice Check the box at the top of the page to indicate the Form you are filing is an amended return.

Attach additional sheets if you need more space. In Part I, enter the name, address, and identifying number of the buyer or other transferee responsible for withholding under section a. Do not enter the name, address, and identifying number of a title company, mortgage company, etc. In Part II, enter the name, address, and identifying number of the entity or fiduciary responsible for withholding under section e. If you are a fiduciary, list your name and the name of the trust or estate.

Enter the home address of an individual or the office address of an entity. For a U. For any entity other than an individual for example, corporation, QIE, estate, or trust , the identifying number is an employer identification number EIN. Also, you can file Form SS-4 by fax or mail. If the individual does not already have an ITIN, he or she should complete Forms and A and mail the forms along with any payment to the address shown under Where To File, earlier.

In a separate package, mail a completed Form W-7 with supporting documentation and a copy of Forms and A to the IRS at the address given in the Form W-7 instructions. Enter the location and a description of the property, including any substantial improvements for example, "unit apartment building". For an interest in a corporation that constitutes a U. Enter the number of Forms A attached to Form Copies A and B of each Form A should be counted as one form. Generally, this is the rate of withholding for transactions required to be reported under section a in Part I.

Amounts entered on line 5b, include the following. For more information, see Exceptions , earlier. If withholding is at a reduced rate, check the box. See Exceptions , earlier. Include the amount withheld in the total reported on line 6, Part I.

B, a corporation, purchases a U. If you are a qualified investment entity, domestic trust or estate, or you make the large trust election, enter the date of distribution for the date of transfer. Generally, this is the rate of withholding for transactions required to be reported under section e in Part II.