Draft Form 8288-B - Withholding certificates for foreign persons disposing of U.S. real property interests 

June 10: IRS posted a draft revision (as of June 7, 2013) of Form 8288-B, Application for Withholding Certificate for Dispositions by Foreign Persons of U.S. Real Property Interests (Rev. August 2013). The draft contains no substantive changes to either the form or instructions.


The IRS can issue a withholding certificate to reduce or eliminate withholding required under section 1445.

  • A certificate issued prior to the transfer notifies the transferee that reduced withholding (or no withholding) is required.
  • A certificate issued after the transfer may authorize an early or normal refund of the amount of withheld tax.

If, on the date of the transfer of a U.S. real property interest (USRPI), an application for a withholding certificate is or has been submitted to the IRS, the withholding is not required to be remitted to the IRS until the 20th day after the day when the IRS mails the withholding certificate or the notice of denial. A transferor that applies for a withholding certificate must notify the transferee, in writing, that a certificate has been applied for on the day or or before the transfer.

Draft of Form 8828-B

The instructions included with the draft of Form 8288-B [PDF 165 KB] provide that the final version of this form is to be used to apply for a withholding certificate to reduce or eliminate withholding on dispositions of U.S. real property interests by foreign person, but only if the application is based on:

  • A claim that the transferor is entitled to non-recognition treatment or is exempt from tax
  • A claim on a calculation that shows the transferor’s maximum tax liability is less than the tax otherwise required to be withheld, or
  • A claim that the special installment sales rules (under section 7 of Rev. Proc. 2000-35) allow for reduced withholding

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