Melissa Gibson from Land Title Guarantee recently sent the email below which explains how the FIRPTA withholding tax will increase from 10% to 15%. Steamboat has a lot of property owners from other countries that will be affected by this increase when they sell. US residents who live outside of Colorado will still be subject to a 2% withholding tax. If you would like more information, please call us at 970-819-6372.
FIRPTA Rate Increase
Recent changes to the Foreign Investment in Real Property Tax Act (FIRPTA) have brought about an increase in the withholding tax rate on the sale of a U.S. real property interest by a foreign investor from 10% to 15%. This change goes into effect on February 16th. This month’s article explains the new change and how it applies to Buyers and Sellers.
PLEASE NOTE THAT THE COLORADO 2% WITHHOLDING TAX IS STILL IN EFFECT AND IS IN ADDITION TO THE 15% FIRPTA TAX. THE TAXES ARE BASED ON THE SALES PRICE – NOT THE GAIN!