Form 8288 is the return a buyer uses to report and pay over the tax withheld when they acquire a U.S. real property interest from a foreign person, under the FIRPTA rules in section 1445. The buyer generally withholds 15% of the amount realized, files Form 8288 with a Form 8288-A for each foreign seller, and sends it with the amount withheld by the 20th day after the transfer.
The surprise for most buyers is that the duty is theirs, not the seller's: if you should have withheld and didn't, the tax can be collected from you. Everything below comes from the IRS Instructions for Form 8288 (Rev. January 2026), checked in October 2026.
How much to withhold
| Situation | Withholding, as of October 2026 |
|---|---|
| General rule | 15% of the amount realized by the foreign seller |
| You're buying it as your residence and the amount realized is $1 million or less | Reduced rate of 10% |
| Individuals buying it as a residence for $300,000 or less | No withholding required |
| Certain distributions by corporations, partnerships, trusts and estates under section 1445(e) | 21% in many cases |
The amount realized is usually the sales price: the cash paid or to be paid, plus the fair market value of other property and any liabilities assumed. For the residence rules, you or a family member must have definite plans to live in the property for at least 50% of the days it's used by anyone in each of the first two 12-month periods after the transfer, not counting days it's empty.
When a U.S. seller gives you a certification
Withholding isn't needed if the seller gives you a certification of nonforeign status, signed under penalties of perjury, with their name, address and taxpayer number. A valid Form W-9 counts. If you receive one, the tax can't be collected from you unless you knew it was false or were told it was false by an agent or a qualified substitute.
Joint sellers
If foreign and U.S. persons sell together, you allocate the amount realized among them based on their capital contribution, withhold only on the share allocated to the foreign sellers, and credit it among them as they agree. A husband and wife are treated as having contributed 50% each.
Filing Form 8288 step by step
- Withhold at closing, even if someone has applied to the IRS for a withholding certificate to reduce or eliminate it.
- Complete Part I of Form 8288 as the buyer, or Part II if you're a corporation, partnership, trust or estate withholding under section 1445(e).
- Complete Form 8288-A for each person subject to withholding. Attach Copies A and B to Form 8288 and keep Copy C.
- Send Form 8288, the Forms 8288-A and the amount withheld to the IRS Ogden Service Center by the 20th day after the date of transfer.
- If a withholding certificate application is pending, you still withhold, but you don't have to file and pay over until the 20th day after the IRS mails you the certificate or a notice of denial.
You don't send copies to the seller. The IRS stamps Copy B of each Form 8288-A and forwards it to the foreign seller, who generally attaches it to a U.S. return, such as Form 1040-NR, to get credit for the tax withheld. A seller without a U.S. number will need an ITIN for that.
Installment sales and withholding certificates
If the price is paid in installments, you must withhold the full amount at the time of the first installment payment. If that first payment doesn't include enough cash or other liquid assets to cover it, you can ask the IRS for a withholding certificate, using Form 8288-B, to reduce or adjust what's withheld.
A withholding certificate issued by the IRS is also the way withholding is reduced or eliminated. But an application changes the timing, not the duty: you still withhold at closing, and you file and pay over by the 20th day after the IRS mails the certificate or a notice of denial.
A buyer's checklist before closing
- Ask whether the seller is a foreign person, and if not, get a signed certification of nonforeign status or a W-9.
- If you're buying a home you'll live in, check the price against the $300,000 and $1 million lines and the 50% use test.
- Make sure the closing statement shows the amount withheld.
- Diarise the 20th day after the transfer for Form 8288, the 8288-As and payment.
- Keep Copy C of every Form 8288-A with your records.
Penalties and who pays
- Late filing and late payment penalties apply under section 6651.
- If you were required to withhold and didn't, the tax and interest may be collected from you.
- Willful failure to collect and pay over the tax can bring a penalty of up to $10,000 under section 7202.
- Corporate officers or other responsible persons can face a penalty equal to the amount that should have been withheld.
- If an application for a withholding certificate was made mainly to delay payment, interest and penalties run from the 21st day after the transfer.
The verdict
If you're buying U.S. property and the seller might be foreign, settle it before closing: get a certification of nonforeign status or a W-9 from a U.S. seller, or plan to withhold 15%, 10% or nothing depending on the price and your use. Then file Form 8288 and the 8288-As within 20 days. It's the buyer's liability if it goes wrong, so don't leave it to the seller's side.
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Frequently asked questions
What is Form 8288 used for?
To report and pay over tax withheld under FIRPTA when a U.S. real property interest is acquired from a foreign person, and certain related distributions.
How much FIRPTA withholding is required?
Generally 15% of the amount realized. It's 10% if you buy the property as a residence for $1 million or less, and nothing if individuals buy it as a residence for $300,000 or less.
When is Form 8288 due?
By the 20th day after the date of transfer, together with the amount withheld.
Who has to withhold under FIRPTA?
The buyer or other transferee. If they were required to withhold and didn't, the tax and interest may be collected from them.
Does a W-9 from the seller stop FIRPTA withholding?
Yes. A certification of nonforeign status, which includes a valid Form W-9, means withholding isn't required unless you know it's false.
Does the buyer send Form 8288-A to the seller?
No. The IRS stamps Copy B and forwards it to the foreign seller, who uses it to claim credit on a U.S. tax return.
