Selling Florida Real Estate as a Foreign Owner — FIRPTA Explained

Tampa Bay has attracted significant investment from international buyers — Canadian snowbirds who bought vacation homes, South American and European investors who purchased rental properties during market dips, and retirees from the UK, Germany, and beyond who chose Florida's climate and lifestyle for their retirement years. If you are a foreign national who owns Florida real estate and you're ready to sell, you'll encounter a layer of U.S. tax law — FIRPTA — that doesn't apply to domestic sellers. FastSellEasy works with foreign owners selling Tampa Bay properties throughout the process. Call (888) 913-9906 to discuss your situation, or visit our homes page to get started.

What Is FIRPTA and Why Does It Apply to Foreign Sellers?

FIRPTA — the Foreign Investment in Real Property Tax Act — was enacted in 1980 to ensure that the U.S. government can collect capital gains tax from foreign persons who sell U.S. real estate. Without FIRPTA, a foreign seller could complete a U.S. property sale, receive the proceeds, and leave the country without ever filing a U.S. tax return or paying the capital gains tax owed.

FIRPTA solves this by making the buyer responsible for withholding a portion of the sale proceeds and sending it to the IRS on the seller's behalf. The buyer — or more commonly, the buyer's closing agent — withholds the required amount at closing and remits it to the IRS within 20 days. The seller receives the net proceeds after withholding.

The law applies to "foreign persons," which the IRS defines as non-resident aliens — individuals who are not U.S. citizens and do not meet the "substantial presence test" or hold a green card. If you are a Canadian, British, German, Brazilian, or other non-U.S. citizen who owns Florida real estate and does not have U.S. permanent resident status, FIRPTA applies to your sale.

How Much Will Be Withheld at Closing?

The standard FIRPTA withholding rate is 15 percent of the gross sale price — not the capital gain, but the entire sale price. This distinction is important. On a $350,000 Tampa Bay home, 15 percent withholding is $52,500 — regardless of what you originally paid for the property, regardless of whether you have a mortgage, and regardless of your actual capital gain.

The 15 percent is an advance payment against any capital gains tax you owe, not necessarily the final tax amount. If your actual capital gains tax liability is less than the amount withheld, you receive a refund from the IRS after filing a U.S. tax return. If your gain is large enough that your actual tax exceeds the amount withheld, you owe the difference.

There is an exception for lower-value sales. If the sale price is $300,000 or less and the buyer intends to use the property as their personal residence for at least two years following the purchase, withholding drops to 10 percent. Below $300,000 with the same buyer-use condition, the buyer may be entirely exempt from withholding — but only if certain certifications are properly executed at closing. These exceptions are narrow and require specific documentation; sellers should not assume they apply without confirming with a qualified tax professional.

Can You Reduce FIRPTA Withholding Before Closing?

Yes — through a process called a withholding certificate. A foreign seller can file IRS Form 8288-B before or at the time of closing to request that the IRS reduce the withholding to the seller's estimated actual tax liability rather than the full 15 percent of the sale price. If approved, withholding is reduced and the seller retains more proceeds at closing rather than waiting for a refund.

The challenge is timing. The IRS typically takes 90 days or more to review and respond to a withholding certificate application. If your closing is scheduled before that approval arrives, closing may proceed with full 15 percent withholding anyway — though the buyer can hold the withheld funds in escrow pending the certificate if both parties agree. Foreign sellers who want to pursue a withholding certificate should initiate the application well before they expect to close, ideally as soon as they decide to sell.

Working with a U.S. tax professional or an international tax attorney who specializes in FIRPTA is strongly recommended. The consequences of incorrect withholding fall on the buyer — the buyer is technically the withholding agent and is liable to the IRS if the correct amount is not remitted. Experienced U.S. closing agents and title companies in Tampa Bay are familiar with FIRPTA procedures and can coordinate the required remittance after closing.

How Do Foreign Sellers Handle Closing Logistics Remotely?

Many foreign sellers complete their Florida property sales entirely from abroad. Florida law allows real estate transactions to be signed by mail or through a power of attorney — a person you formally designate to act on your behalf in the transaction. A power of attorney executed in your home country may need to be notarized and apostilled for use in Florida; your international attorney or the Florida title company can advise on the specific requirements.

DocuSign and electronic signature platforms are widely accepted in Florida real estate transactions for most documents. Certain documents — the deed, for example — may require wet ink signatures depending on the county and the title company's requirements. Your closing agent will clarify which documents can be signed electronically and which require mailing or in-person execution.

Cash buyers simplify this process compared to financed buyers. A financed transaction involves a U.S. lender who may have additional documentation requirements for foreign sellers, an appraisal that must be scheduled around the seller's unavailability, and potential delays if the lender raises questions about FIRPTA compliance. A cash buyer has no lender in the chain — the transaction proceeds between the seller, the buyer, and the title company, with fewer moving parts to coordinate across time zones.

What About Foreign Sellers With Outstanding U.S. Tax Obligations?

FIRPTA withholding is separate from any other U.S. tax obligations you may have. If you've been earning rental income from a Florida property and have not filed the required U.S. tax returns, those obligations don't disappear at closing — they're separate from the sale proceeds and remain your responsibility. The IRS has the ability to pursue unpaid tax obligations regardless of whether you're in the U.S. at the time.

Sellers with rental income histories and unfiled returns should consult a U.S. tax professional before closing. In many cases, the penalties can be reduced through voluntary disclosure programs, and addressing unfiled returns proactively puts you in a much better position than having the IRS discover the issue after your proceeds have been disbursed. For guidance on the rental income tax side of Florida investment properties, our overview of renting versus selling Florida investment property covers the ongoing tax considerations for property owners.

How Does FastSellEasy Work With Foreign Sellers?

We work with foreign owners selling Tampa Bay properties regularly — Canadian snowbirds, European investors, Latin American buyers who purchased during prior market cycles, and retirees who've relocated elsewhere and are ready to liquidate their Florida asset. We understand the FIRPTA process, work with title companies experienced in international transactions, and can structure closings that accommodate remote execution and international wire transfers.

We don't require you to be in Tampa Bay to sell. We don't need you to repair or stage the property. And we move quickly — which matters when you're managing a sale from abroad and want certainty rather than an open-ended listing process that could stretch six to twelve months.

If you're a foreign national selling a Florida property in Tampa Bay or anywhere in the surrounding region, call (888) 913-9906. Tell us about the property and your situation. We'll provide a written cash offer within 24 to 48 hours and walk you through exactly what to expect at every step of the process — including the FIRPTA documentation your closing agent will require. There's no obligation and no cost to get an offer.