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When a U.S. real property interest is acquired from a foreign person, the Foreign Investment in Real Property Tax Act (FIRPTA) may come into play. FIRPTA requires that the buyer withhold a certain percentage of the purchase price (typically 15%) and submit it to the IRS as a tax withholding. This withholding serves as a way to ensure that any applicable taxes on the foreign person's gain from the sale are paid. To comply with FIRPTA, the buyer must: 1. Determine if the seller is a foreign person, which generally includes nonresident alien individuals, foreign corporations, foreign partnerships, foreign trusts, and foreign estates. 2. If the seller is a foreign person, withhold 15% of the amount realized on the disposition, which usually means 15% of the gross sales price. 3. File IRS Form 8288, "U.S. Withholding Tax Return for Dispositions 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 Interests," to report the withholding and transmit the withheld amount to the IRS. These forms must be filed and the taxes paid within 20 days of the transfer date. Note that there are specific exemptions, reduced rates, or other circumstances where the FIRPTA withholding requirements may not apply or may be adjusted. If you believe any of these exceptions apply, it's important to research the specific rules and consult with a tax professional to ensure compliance.