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New Hampshire Non-Foreign Affidavit Under IRC 1445

New Hampshire Non-Foreign Affidavit Under IRC 1445

Category:

Real Estate - Closings

State:

New Hampshire

Control #:

NH-CLOSE7

Format:

Instant download

About this form

The Non-Foreign Affidavit Under IRC 1445 is a legal document that certifies a seller's status as a non-foreign person under the Internal Revenue Code. This form is essential for real estate transactions involving foreign sellers, as it helps the buyer avoid withholding tax obligations. By affirming non-foreign status, sellers can streamline the property transfer process and ensure compliance with IRS regulations.

What’s included in this form

Identification of the seller(s) and their property details
Statement confirming the seller(s) are not foreign persons
Inclusion of taxpayer identification numbers
Certification for the buyer or transferee regarding non-foreign status
Notary section for formal validation

FIRPTA Certificate of Non-Foreign Status - Individual

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FIRPTA Certificate of Non-Foreign Status - Entity

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FIRPTA Affidavit- Individual Transfer

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FIRPTA Statement By Qualified Substitute

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Ownership Disclosure Statement

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When this form is needed

This affidavit should be used during the sale of real property when the seller needs to certify that they are not a foreign person. It is typically required when the buyer needs to comply with IRS withholding regulations under Section 1445, preventing any unnecessary tax withholding on the sale proceeds. If the seller is a foreign national, this form is not applicable.

Who should use this form

U.S. citizens selling real estate
Permanent residents of the United States
Legal entities that qualify as non-foreign under IRC Section 1445

How to prepare this document

Identify the seller(s) involved in the transaction
Provide the property address and legal description
Enter each seller's taxpayer identification number and address
Confirm and sign the affidavit stating non-foreign status
Have the document notarized to validate its authenticity

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Avoid these common issues

Failing to provide accurate seller identification or property details
Omitting taxpayer identification numbers
Not having the affidavit notarized
Assuming the form is unnecessary when the seller is a U.S. citizen

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Non-Foreign Affidavit Under IRC 1445

Description: Under Federal law, (the Foreign Investment in Real Property Tax Act (FIRPTA)(26 USC 1445) and the regulations thereunder (26 CFR Parts 1 and 602)), a buyer of real estate is required to withhold a tax from the sale of real property to a foreign person unless an exemption applies. An exemption from withholding is provided for individuals who purchase property for use as their principal residence for $300,000 or less. Principal residence is defined to mean that the buyer will reside there for more than 50% of the time in each of the next two years. If you have a duty to withhold and you fail to do so, you can be liable for an amount equal to your compensation in the transaction and in some cases for the amount of tax that should have been withheld The affidavit is needed to provide the buyer with assurance that the seller is not a foreign person.

The general rule and exemptions as stated in Sec. 1445, Withholding of tax on dispositions of United States real property interests, provides:

(a) General rule

Except as otherwise provided in this section, in the case of any disposition of a United States real property interest (as defined in section 897(c)) by a foreign person, the transferee shall be required to deduct and withhold a tax equal to 10 percent of the amount realized on the disposition.

(b) Exemptions

(1) In general

No person shall be required to deduct and withhold any amount under subsection (a) with respect to a disposition if paragraph (2), (3), (4), (5), or (6) applies to the transaction.

(2) Transferor furnishes nonforeign affidavit. Except as provided in paragraph (7), this paragraph applies to the disposition if the transferor furnishes to the transferee an affidavit by the transferor stating, under penalty of perjury, the transferor's United States taxpayer identification number and that the transferor is not a foreign person.

(3) Nonpublicly traded domestic corporation furnishes affidavit that interests in corporation not United States real property interests. Except as provided in paragraph (7), this paragraph applies in the case of a disposition of any interest in any domestic corporation if the domestic corporation furnishes to the transferee an affidavit by the domestic corporation stating, under penalty of perjury, that -

(A) the domestic corporation is not and has not been a United States real property holding corporation (as defined in section 897(c)(2)) during the applicable period specified in section 897(c)(1)(A)(ii), or

(B) as of the date of the disposition, interests in such corporation are not United States real property interests by reason of section 897(c)(1)(B).

(4) Transferee receives qualifying statement

(A) In general. This paragraph applies to the disposition if the transferee receives a qualifying statement at such time, in such manner, and subject to such terms and conditions as the Secretary may by regulations prescribe.

(B) Qualifying statement. For purposes of subparagraph (A), the term ''qualifying statement'' means a statement by the Secretary that -

(i) the transferor either -

(I) has reached agreement with the Secretary (or such agreement has been reached by the transferee) for the payment of any tax imposed by section 871(b)(1) or 882(a)(1) on any gain recognized by the transferor on the disposition of the United States real property interest, or

(II) is exempt from any tax imposed by section 871(b)(1) or 882(a)(1) on any gain recognized by the transferor on the disposition of the United States real property interest, and

(ii) the transferor or transferee has satisfied any transferor's unsatisfied withholding liability or has provided adequate security to cover such liability.

(5) Residence where amount realized does not exceed $300,000. This paragraph applies to the disposition if -

(A) the property is acquired by the transferee for use by him as a residence, and

(B) the amount realized for the property does not exceed $300,000.

(6) Stock regularly traded on established securities market. This paragraph applies if the disposition is of a share of a class of stock that is regularly traded on an established securities market.

(7) Special rules for paragraphs (2) and (3). Paragraph (2) or (3) (as the case may be) shall not apply to any disposition -

(A) if -

(i) the transferee has actual knowledge that the affidavit referred to in such paragraph is false, or

(ii) the transferee receives a notice (as described in subsection (d)) from a transferor's agent or a transferee's agent that such affidavit is false, or

(B) if the Secretary by regulations requires the transferee to furnish a copy of such affidavit to the Secretary and the transferee fails to furnish a copy of such affidavit to the Secretary at such time and in such manner as required by such regulations.

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Non-Foreign Affidavit Under IRC 1445

The general rule and exemptions as stated in Sec. 1445, Withholding of tax on dispositions of United States real property interests, provides:

(a) General rule

(b) Exemptions

(1) In general

No person shall be required to deduct and withhold any amount under subsection (a) with respect to a disposition if paragraph (2), (3), (4), (5), or (6) applies to the transaction.

(B) as of the date of the disposition, interests in such corporation are not United States real property interests by reason of section 897(c)(1)(B).

(4) Transferee receives qualifying statement

(B) Qualifying statement. For purposes of subparagraph (A), the term ''qualifying statement'' means a statement by the Secretary that -

(i) the transferor either -

(II) is exempt from any tax imposed by section 871(b)(1) or 882(a)(1) on any gain recognized by the transferor on the disposition of the United States real property interest, and

(ii) the transferor or transferee has satisfied any transferor's unsatisfied withholding liability or has provided adequate security to cover such liability.

(5) Residence where amount realized does not exceed $300,000. This paragraph applies to the disposition if -

(A) the property is acquired by the transferee for use by him as a residence, and

(B) the amount realized for the property does not exceed $300,000.

(6) Stock regularly traded on established securities market. This paragraph applies if the disposition is of a share of a class of stock that is regularly traded on an established securities market.

(7) Special rules for paragraphs (2) and (3). Paragraph (2) or (3) (as the case may be) shall not apply to any disposition -

(A) if -

(i) the transferee has actual knowledge that the affidavit referred to in such paragraph is false, or

(ii) the transferee receives a notice (as described in subsection (d)) from a transferor's agent or a transferee's agent that such affidavit is false, or

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Note: All Information and Previews are subject to the Disclaimer located on the main forms page, and also linked at the bottom of all search results.

New Hampshire Non-Foreign Affidavit Under IRC 1445

About this form

What’s included in this form

Related forms

When this form is needed

Who should use this form

How to prepare this document

Notarization guidance

Get your form ready online

Avoid these common issues

Why use this form online

Looking for another form?

Form popularity

Explore more forms

Trusted and secure by over 3 million people of the world’s leading companies

New Hampshire Non-Foreign Affidavit Under IRC 1445

About this form

What’s included in this form

Related forms

When this form is needed

Who should use this form

How to prepare this document

Notarization guidance

Get your form ready online

Related legal definitions

Avoid these common issues

Why use this form online

Looking for another form?

Form popularity

New Hampshire Non-Foreign Affidavit Under IRC 1445 Related Searches

Explore more forms

Trusted and secure by over 3 million people of the world’s leading companies