Tax season is over, at least for the time being, leading to a period of relative calm in our tax sector, however, the real estate market presents a different scenario.
With many individuals leaving the country for various reasons, inquiries regarding the Substantial Presence Test (SPT) are becoming increasingly frequent. It is important to note that only four specific documents can exempt a seller from FIRPTA without further inquiry:
- U.S. Passport
2. U.S. Birth Certificate
3. Naturalization Certificate
4. Valid Permanent Resident Card (commonly known as a "Green Card")
Having a state driver's license and a U.S. tax identification number alone does not qualify a seller as a U.S. tax resident.
Recently, we have received calls regarding individuals who have resided in the U.S. for several years, have a TIN, and are no longer in the country, likely without the option to return. What steps should we take in this situation?
It is crucial for title agents not to make determinations regarding SPT, as the regulations can be complex and often misunderstood. Certain visa holders days of presence in the U.S. do not count for SPT, reason why is advisable to seek guidance from a qualified tax professional with expertise in this area.
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Mary Enzi CAA
Tax Solutions – FIRPTA Consulting
[email protected]+1 (281) 578-1040
Katy TX
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