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Form 8288 (Rev. 11-2005)
Page
property interest by purchase, exchange,
property interest is subject immediately
transferor’s agent that it was false. The
gift, or any other transfer.
before and after the transfer. Generally,
certification must be signed by the
the amount realized for purposes of this
individual, a responsible officer of a
Transferor. For purposes of this
withholding is the sales or contract
corporation, a general partner of a
withholding, this means any foreign
price.
partnership, or the trustee, executor, or
person that disposes of a U.S. real
fiduciary of a trust or estate.
Date of transfer. The first date on which
property interest by sale, exchange, gift,
consideration is paid or a liability is
A disregarded entity may not certify
or any other disposition. A disregarded
assumed by the transferee. However, for
that it is the transferor for U.S. tax
entity cannot be transferor for purposes
purposes of sections 1445(e)(2), (3), and
purposes, including sections 897 and
of section 1445. Instead, the person
(4), and Regulations sections
1445. Rather, the owner of the
considered as owning the assets of the
1.1445-5(c)(1)(iii) and 1.1445-5(c)(3), the
disregarded entity is treated as the
disregarded entity for federal tax
date of transfer is the date of distribution
transferor of the property and must
purposes is regarded as the transferor.
that creates the obligation to withhold.
provide the certificate of nonforeign
A disregarded entity for these purposes
Payment of consideration does not
status to avoid withholding under
means an entity that is disregarded as
include the payment before passage of
section 1445.
an entity separate from its owner under
legal or equitable title of earnest money
Regulations section 301.7701-3, a
A foreign corporation electing to be
(other than pursuant to an initial
qualified REIT subsidiary as defined in
treated as a domestic corporation under
purchase contract), a good-faith deposit,
section 856(i), or a qualified subchapter
section 897(i) must attach to the
or any similar amount primarily intended
S subsidiary under section 1361(b)(3)(B).
certification a copy of the
to bind the parties to the contract and
acknowledgment of the election received
Withholding agent. For purposes of this
subject to forfeiture. A payment that is
from the IRS. The acknowledgment must
return, this means the buyer or other
not forfeitable may also be considered
state that the information required by
transferee who acquires a U.S. real
earnest money, a good-faith deposit, or
Regulations section 1.897-3 has been
property interest from a foreign person.
a similar sum.
determined to be complete. If the
Foreign person. A nonresident alien
acknowledgment is not attached, you
Exceptions
individual, a foreign corporation that
may not rely on the certification. Keep
does not have a valid election under
You are not required to withhold if any
any certification of nonforeign status you
section 897(i) to be treated as a
of the following applies:
receive in your records for 5 years after
domestic corporation, a foreign
the year of transfer.
1. Purchase of residence for
partnership, a foreign trust, or a foreign
You may also use other means to
$300,000 or less. One or more
estate. A resident alien individual is not
determine that the transferor is not a
individuals acquire U.S. real property for
a foreign person.
foreign person. But if you do, and it is
use as a residence and the amount
U.S. real property interest. Any
later determined that the transferor is a
realized (sales price) is not more than
interest, other than an interest solely as
foreign person, the withholding tax may
$300,000. A U.S. real property interest is
a creditor, in:
be collected from you.
acquired for use as a residence if you or
1. Real property located in the United
a member of your family has definite
Late notice of false certification. If,
States or the Virgin Islands.
plans to reside in the property for at
after the date of transfer, you receive a
least 50% of the number of days the
2. Certain personal property
notice from your agent or the
property is used by any person during
associated with the use of real property.
transferor’s agent that the certification of
each of the first two 12-month periods
nonforeign status is false, you do not
3. A domestic corporation, unless it is
following the date of transfer. Do not
have to withhold on consideration paid
shown that the corporation was not a
take into account the number of days
before you received the notice.
U.S. real property holding corporation
the property will be vacant in making
However, you must withhold the full
during the previous 5 years (or during
this determination. No form or other
10% of the amount realized from any
the period in which the transferor held
document is required to be filed with the
consideration that remains to be paid, if
the interest, if shorter).
IRS for this exception; however, if you
possible. You must do this by
A U.S. real property interest does not
do not in fact use the property as a
withholding and paying over the entire
include:
residence, the withholding tax may be
amount of each successive payment of
collected from you.
1. An interest in a domestically
consideration until the full 10% has been
controlled qualified investment entity see
withheld and paid to the IRS. These
This exception applies whether or not
section 897(h).
amounts must be reported and
the transferor (seller) is an individual,
transmitted to the IRS by the 20th day
partnership, trust, corporation, or other
2. An interest in a corporation that has
following the date of each payment.
transferor. However, this exception does
disposed of all its U.S. real property
not apply if the actual transferee (buyer)
interests in transactions in which the full
3. Transferred property that is not a
is not an individual, even if the property
amount of any gain was recognized as
U.S. real property interest. You acquire
is acquired for an individual.
provided in section 897(c)(1)(B).
an interest in property that is not a U.S.
real property interest (defined on this
2. Transferor not a foreign person.
3. An interest in certain publicly traded
page). A U.S. real property interest
You receive a certification of nonforeign
corporations, partnerships, and trusts.
includes certain interests in U.S.
status from the transferor, signed under
See Regulations sections 1.897-1 and -2
corporations, as well as direct interests
penalties of perjury, stating that the
for more information. Also see
in real property and certain associated
transferor is not a foreign person and
Transferred property that is not a U.S.
personal property.
containing the transferor’s name,
real property interest on this page.
address, and identification number
No withholding is required on the
Amount realized. The sum of the cash
(social security number (SSN) or
acquisition of an interest in a domestic
paid or to be paid (not including interest
employer identification number (EIN)). If
corporation if (a) any class of stock of
or original issue discount), the fair
you receive a certification, the
the corporation is regularly traded on an
market value of other property
withholding tax cannot be collected from
established securities market, or
transferred or to be transferred, and the
you unless you knew that the
(b) the transferee receives a statement
amount of any liability assumed by the
certification was false or you received a
by the corporation that the interest is not
transferee or to which the U.S. real
notice from your agent or the
a U.S. real property interest, unless you