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  • 1.  FIRPTA (again)

    Posted 06-06-2024 10:07
    Asking for a friend regarding FIRPTA:
    Has anyone had experience with a seller waiting for IRS Clearance and requesting the money be held in escrow until that comes through? Is that recommended? And if so for how long and how much? The IRS Publication seems to indicate that under certain circumstances, the agent could be held liable for penalties and interest. The Settlement Provider has been put in an uncomfortable situation since the Title Agent is not being helpful. 

    Mary C. Carroll

    Carroll Title Agency, Inc.

    P.O. Box 12, Hawthorne, NJ 07507-0012 - US MAIL DELIVERIES ONLY

    662 Goffle Road, Suite 1, Hawthorne, NJ 07506 - FEDEX and UPS DELIVERIES ONLY

    Telephone - (973) 238-0400  ||  Fax - (973) 238-0038

    Email -  [email protected]

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  • 2.  RE: FIRPTA (again)

    Posted 06-06-2024 11:52

    Hi Mary,

    Unfortunately, the IRS is taking between 12 to 14 months processing withholding certificates, Please feel free to give us a call at your convenience, we will be glad to discuss with you the options there are available in this regard. 

    Mary Enzi CAA
    Tax Solutions – FIRPTA Consulting
    [email protected]
    +1 (281) 578-1040
    Barker TX

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  • 3.  RE: FIRPTA (again)

    Posted 06-07-2024 10:12
    I recommend that you work very closely with your title insurance underwriter. Our firm handled an instance involving a Short Sale where the Seller had applied for the Certificate of Exemption but it would not come in prior to the expiration of the Short Sale approval. The Seller was able to post a bond in an amount prescribed by the title insurance underwriter to their benefit and to the benefit of the closing/settlement agent that would cover the payment along with any penalties and interest if the IRS determined that the transaction did not qualify for the exemption. 

    Thank you,

    Kimberly A. Gilbert-Toelle, Esq.*
    Raber Law Offices, PLLC

    484 Williamsport Pike, PMB #300
    Martinsburg, WV 25404

    Fax 304-441-5551
    [email protected]
    alt. email:
    [email protected]

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  • 4.  RE: FIRPTA (again)

    Posted 06-07-2024 12:28

    I am an Escrow Officer/Settlement Provider in California and our industry CPAs and FIRPTA processing vendors have advised us that due to the amount of time needed to get a Withholding Certificate back from the IRS, it is best to just send in the 10% or 15% at closing. At this rate they would probably get their money back faster by filing their income tax at the end of the year. Plus if sent out correctly to the IRS the liability and penalties to the Buyer and Settlement Provider is removed. 

    Hope this helps.

    Juliana Tu, CSEO, CEO, CBSS, CEI, SASIP
    Escrow Manager
    Viva Escrow! Inc.
    Arcadia CA 91006
    Member, California Escrow Association
    Member. Escrow Institute of California

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  • 5.  RE: FIRPTA (again)

    Posted 06-07-2024 13:01
    Hi Juliana;
    That is correct, withholding certificates processing time is between 10 to up 14 months. It is ridiculous. Seller will recover the FIRPTA deposit faster by filing a U. S. tax return. 

    Mary Santiago, CAA

    Office Manager



    P. O. Box # 207

    Barker, TX 77413

    281 578-1040 Ofc

    832-201-9121 Fax


    "We have the Solution to tax problems!"

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  • 6.  RE: FIRPTA (again)

    Posted 06-07-2024 13:01

    I must say that I have received a lot of great assistance from everyone!  I don't know that I expected such an outpouring of advice and I respect and appreciate everyone who has responded.  I have taken all of your suggestions and presented them.  I of course prefer the "pay it now" idea.  It seems to me that the seller's accountant gave incorrect or bad information to his client, which has caused him to be a bit ornery, and that doesn't help anybody!

    Mary Carroll
    Carroll Title Agency, Inc.
    Hawthorne NJ
    +1 (973) 238-0400

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