Can Foreigners Buy U.S. Real Estate? Sure, but You'll Pay Some Big Taxes!!

If you are a non-U.S. resident and you are looking to buy U.S. real property, you can certainly do so, but be careful of the tax issues...

Non-U.S. persons must be careful of potential U.S. taxes on effectively connected income, U.S. source FDAP income, and potential U.S. estate taxes.

Nonresidents are potentially subject to the following taxes when they invest in U.S. real estate:

1. 30% FDAP withholding
2. Federal taxes at graduated rates on the net ECI

IRS Form 8288 Withholding Taxes:    • IRS Form 8288 - Withholding Taxes on ...  

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