FIRPTA 2026: What a Colombian Seller Actually Pays

If you're a Colombian citizen selling a condo in Florida, the U.S. government doesn't wait for you to file a tax return to collect. Under the Foreign Investment in Real Property Tax Act (FIRPTA), the buyer is legally required to withhold a percentage of your sale price at closing and send it straight to the IRS -- before you see a dollar. Most sellers only find out how much that actually is a few weeks before closing, when it's too late to do anything but accept it. Here's the real math, and the one thing you can do months earlier to change it.

Scenario A and B are the same $450,000 sale -- the only thing that changed is what the buyer signs an affidavit saying they'll do with the property. That's a $22,500 difference in cash you have at closing versus cash you have to wait a year to get back. It's worth asking your closing agent, before you accept an offer, whether the buyer is willing to sign that affidavit if it's true.

You don't have to accept the default 15% and wait a year for a refund. You can apply for a withholding certificate (IRS Form 8288-B) before closing, which lets the IRS approve a reduced withholding amount based on your actual, calculated tax liability -- not the full gross price. If your real gain is small, or you have deductible expenses that bring your actual tax owed well below 15% of the sale price, this is the mechanism that gets you that money at closing instead of a year later.

Florida has no state income tax -- a fact most sellers already know, and one that can create a false sense of security. FIRPTA is federal, not state. It doesn't matter that Florida itself won't tax your sale; the IRS withholding applies regardless of which state the property is in. The confusion usually shows up the other way too: some sellers assume that because there's no state tax, the federal withholding must be smaller than it actually is. It isn't -- the 15%/10% math above is the same whether the property is in Miami, Orlando, or anywhere else in the country.

The other Florida-specific wrinkle is timing pressure. Florida's real estate market moves fast, especially on condos priced to sell -- and a fast-moving buyer with financing already lined up can push for a 30-day close. That's exactly the window where a seller who hasn't already started the Form 8288-B conversation runs out of time to reduce their withholding before money changes hands. The fix isn't to slow down your sale; it's to start the certificate conversation the moment you're seriously considering listing, not after you accept an offer.

Withholding at closing is not your final U.S. tax bill -- it's a deposit against it. As a foreign seller, you're required to file a U.S. nonresident tax return (Form 1040-NR) for the year of the sale, reporting the actual gain and calculating the real tax owed. If the amount withheld at closing was more than your actual liability -- which is common, since the withholding is based on the gross price, not your gain -- filing that return is how you claim the difference back as a refund.

This is the part that catches sellers off guard: getting a withholding certificate before closing and filing a 1040-NR afterward are two separate tools that solve the same problem at different times. The certificate front-loads the correction, so less money gets tied up in the first place. The tax return is the backstop if you didn't get a certificate, or if the certificate only reduced withholding partway. Most sellers benefit from planning for both -- try for the certificate first, and treat the following year's tax return as the safety net, not the primary plan.

FIRPTA itself hasn't changed its core rates, but enforcement has tightened. The IRS has been auditing FIRPTA compliance more aggressively on higher-dollar transactions, and applying stricter tests for what counts as "foreign" ownership -- including foreign-owned LLCs that have some U.S.-based control, which can still trigger FIRPTA if a foreign person holds the real controlling stake. If you hold your Florida property through a company structure rather than in your own name, that detail is worth confirming with a tax professional before you assume you're in the clear either way.