Alaska Non-Foreign Affidavit Under IRC 1445
Overview of this form
The Non-Foreign Affidavit Under IRC 1445 is a legal document that sellers of real property use to certify that they are not foreign persons as defined by the Internal Revenue Code. This affidavit is critical in real estate transactions because it helps avoid withholding taxes on the sale of property by confirming the seller's status as a domestic entity, distinguishing it from other forms that may not address this specific requirement.
Key components of this form
- Identification of the seller(s) and their taxpayer identification numbers.
- Details regarding the property being sold, including its address and tax identifiers.
- A declaration that the seller(s) are not foreign persons under IRC Section 1445.
- The intended recipient of the affidavit, typically the property buyer.
- Space for notarization to affirm the affidavit's authenticity.
Situations where this form applies
This form is used during the sale of real estate when the seller needs to demonstrate their status as a non-foreign person. It's essential in transactions involving property to ensure compliance with tax regulations that might impose withholding taxes on foreign sellers. If you are a seller and your property transaction is closing, you should complete this affidavit to avoid potential tax complications.
Who should use this form
- Individuals or entities selling real estate in the United States.
- Sellers who do not qualify as foreign persons under federal tax regulations.
- Real estate agents or attorneys assisting sellers with property transactions.
How to prepare this document
- Identify the seller(s) and enter their full names along with taxpayer identification numbers.
- Specify the property being sold by providing its complete address and any relevant parcel or tax identification numbers.
- State affirmatively that the seller(s) are not foreign persons as defined in the Internal Revenue Code.
- Provide the name of the buyer(s) who will receive this affidavit.
- Sign and date the form, ensuring that it is notarized by a licensed notary public.
Notarization requirements for this form
Notarization is required for this form to take effect. Our online notarization service, powered by Notarize, lets you verify and sign documents remotely through an encrypted video session, available 24/7.
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Make edits, fill in missing information, and update formatting in US Legal Forms—just like you would in MS Word.
Download a copy, print it, send it by email, or mail it via USPS—whatever works best for your next step.
Sign and collect signatures with our SignNow integration. Send to multiple recipients, set reminders, and more. Go Premium to unlock E-Sign.
If this form requires notarization, complete it online through a secure video call—no need to meet a notary in person or wait for an appointment.
We protect your documents and personal data by following strict security and privacy standards.
Common mistakes to avoid
- Failing to provide complete identification for all sellers.
- Omitting property details or entering incorrect identifiers.
- Not having the affidavit notarized, which may render it invalid.
- Misunderstanding the definition of a foreign person under the Internal Revenue Code.
Benefits of completing this form online
- Convenience of accessing legal forms at any time, from anywhere.
- Ability to easily edit and customize the form to fit specific selling scenarios.
- Access to professionally drafted templates by licensed attorneys for reliability and compliance.
Main things to remember
- The Non-Foreign Affidavit is essential for avoiding foreign seller withholding taxes in real estate transactions.
- Completing the form accurately can prevent legal and financial complications.
- Always ensure notarization is completed for the affidavit to be valid.
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FAQ
The address of the property being transferred (or sold) The seller or transferor's information: Full name. Telephone number. Address. Social Security Number, Federal Employer Identification Number, or California Corporation Number.
Rather, A buyer or other transferee of a U.S. real property interest, and a corporation, qualified investment entity, or fiduciary that is required to withhold tax, must file TIP Form 8288 to report and transmit the amount withheld. If two or more persons are joint transferees, each is obligated to withhold.
The IRS defines a foreign person as a nonresident alien individual, a foreign corporation not treated as a domestic corporation, or a foreign partnership, trust, or estate. A seller who is a U.S. citizen or a U.S. permanent resident (green card holder) is generally exempt from FIRPTA withholding.
The only other way to avoid FIRPTA is via a withholding certificate. If FIRPTA withholding exceeds the maximum tax liability realized on the sale of the real property, sellers can appeal to the IRS for a lower withholding amount.
FIRPTA withholding is required to be submitted to the IRS within 20 days of the closing together with IRS Form 8288, U.S. Withholding Tax Return for Disposition by Foreign Persons of U.S. Real Property Interests, and Form 8288-A, Statement of Withholding on Dispositions by Foreign Persons of U.S. Real Property
This document, included in the seller's opening package, requests that the seller swears under penalty of perjury that they are not a non-resident alien for purposes of United States income taxation. A Seller unable to complete this affidavit may be subject to withholding up to 15%.
The Foreign Investment in Real Property Transfer Act (FIRPTA) requires any buyer of a U.S. real property interest to withhold ten percent of the amount realized by a foreign seller. 26 USC § 1445(a).
FIRPTA is a tax law that imposes U.S. income tax on foreign persons selling U.S. real estate. Under FIRPTA, if you buy U.S. real estate from a foreign person, you may be required to withhold 10% of the amount realized from the sale. The amount realized is normally the purchase price.
