FIRPTA ITIN and TIN Closing Guide for Foreign Sellers (2025-2026)
FIRPTA withholding flow
How U.S. real property dispositions by foreign persons are withheld and reported.
Identify the disposition
Sale or transfer of a U.S. real property interest.
Withhold at closing
The buyer withholds a percentage of the amount realized.
Report the withholding
File Forms 8288 and 8288-A with the IRS.
Reconcile on the return
Claim the credit on the seller's U.S. tax return.
Key Takeaways
- FIRPTA filings generally require TIN information from the buyer and foreign seller.
- A missing seller TIN does not cancel the withholding filing duty.
- Form W-7 can be paired with Form 8288-B in the right case.
- TIN planning should be part of the pre-closing checklist.
TIN problems should be surfaced before closing, not discovered in the mail room
The IRS rules require transferees and foreign transferors to provide taxpayer identification numbers on FIRPTA withholding returns and withholding-certificate applications. Many foreign sellers only realize they need an ITIN when the closing file is already being assembled. That creates pressure because the real-estate deal team wants a clean close while the tax file suddenly needs identity documentation too.
Missing seller TIN does not stop the main withholding filing
The 2026 Instructions for Form 8288 say that if the transferor's TIN is missing, the withholding agent must still file Forms 8288 and 8288-A. In other words, the absence of the seller's number does not erase the filing duty. It simply makes the credit and processing path less clean.
When a withholding certificate is being requested, the ITIN lane can be paired with it
The IRS page on reporting and paying tax on U.S. real property interests says a nonresident alien without a TIN but eligible for an ITIN can apply by attaching Form 8288-B to a completed Form W-7 and sending the package to the IRS as instructed. That pairing can be critical in a reduced-withholding case.
Frequently Asked Questions
Can a buyer skip FIRPTA filing because the foreign seller has no ITIN yet?
No. The IRS instructions say the withholding package still has to be filed even if the transferor's TIN is missing.
How can a foreign seller seek an ITIN in a reduced-withholding case?
The IRS says an eligible nonresident can attach Form 8288-B to Form W-7 and send the combined package as instructed.
Why is late TIN planning dangerous in a property sale?
Because it complicates both the withholding filing and the seller's later effort to claim credit or obtain reduced withholding.
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