Virginia Non-Foreign Affidavit Under IRC 1445
What is this form?
The Non-Foreign Affidavit Under IRC 1445 is a legal document that sellers of real property use to assert that they are not considered foreign persons according to Internal Revenue Code Section 1445. This form serves a crucial purpose in real estate transactions, especially to exempt buyers from withholding requirements related to foreign sellers. Unlike similar affidavits, this form specifically addresses tax compliance issues for property sellers in the United States.
Form components explained
- Identification of the seller(s) and property involved
- Confirmation that the seller(s) are not foreign persons as defined by the IRC
- Taxpayer identification numbers for the seller(s)
- Notary section for legal validation
- Dates and signatures of the seller(s)
- Recipient information for the transferee(s) or buyer(s)
When to use this document
This form should be used when a seller is transferring real estate and needs to establish that they are not a foreign person. This is particularly important for buyers to avoid the withholding tax that is imposed on foreign sellers. Use this affidavit during the closing process of a real estate sale to ensure all parties comply with tax regulations.
Intended users of this form
This affidavit is suitable for:
- Property sellers in real estate transactions
- Buyers who need to comply with IRC 1445 requirements
- Real estate professionals assisting in closing transactions
Steps to complete this form
- Identify the seller(s) by entering their full names.
- Provide the address and legal description of the property being sold.
- List the taxpayer identification numbers for all sellers.
- Confirm under penalty of perjury that the seller(s) are not foreign persons.
- Sign and date the document in the presence of a notary public.
- Ensure the completed affidavit is provided to the buyer(s) for compliance.
Is notarization required?
This document requires notarization to meet legal standards. US Legal Forms provides secure online notarization powered by Notarize, allowing you to complete the process through a verified video call, 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
- Failing to provide accurate property descriptions.
- Not including all seller(s) taxpayer identification numbers.
- Omitting notarization when required.
- Incomplete signatures or missing dates.
- Incorrectly stating non-foreign status without verifying eligibility.
Advantages of online completion
- Convenience: Access and complete the form from anywhere at any time.
- Editability: Easily make necessary changes before finalizing the document.
- Reliability: Use a template crafted by licensed attorneys to ensure compliance with legal requirements.
- Instant download: Obtain your affidavit right after completion, avoiding delays.
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FAQ
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%.
In most cases, the purchaser of a U.S. real property interest must deduct and withhold ten percent of the amount realized by the foreign seller. However, the amount withheld should not exceed the seller's maximum tax liability.
What Is a Certification of Non-Foreign Status? With a Certification of Non-Foreign Status, the seller of real estate is certifying under penalty of perjury, that the seller is not foreign. Therefore, the seller and the transaction will not have the withholding requirements.
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.
Persons purchasing U.S. real property interests (transferees) from foreign persons, certain purchasers' agents, and settlement officers are required to withhold 15% (10% for dispositions before February 17, 2016) of the amount realized on the disposition (special rules for foreign corporations).
FIRPTA Exemptions The sales price is $300,000 or less, and. The buyer signs affidavit at or before closing stating they intend to use property for personal purposes for at least 50% of time property occupied for the each of the first two 12 month periods immediately after closing.
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).
You or a member of your family must have definite plans to reside at the property for at least 50% of the number of days the property is used by any person during each of the first two 12-month periods following the date of transfer.
