Escrow & Title
What is 'foreign seller FIRPTA withholding' in Hawaii real estate and when does it apply?
AA. FIRPTA withholding never applies to Hawaii property sales
BB. FIRPTA requires buyers of US real property from foreign persons to withhold 15% of the amount realized and remit it to the IRS; it applies to many Hawaii sales given the significant foreign investment in Hawaiian real estate✓ Correct
CC. FIRPTA withholding is only required for sales over $1 million in Hawaii
DD. Hawaii has its own separate withholding law that replaces FIRPTA
Explanation
The Foreign Investment in Real Property Tax Act (FIRPTA) requires buyers to withhold 15% (with some exceptions) of the amount realized from the sale of US real property by foreign persons and remit it to the IRS. Given Hawaii's significant Japanese, Chinese, and other foreign investment, FIRPTA applies frequently.
Related Hawaii Escrow & Title Questions
- In Hawaii, the Bureau of Conveyances is responsible for:
- In Hawaii, an 'estoppel certificate' from a lender confirms:
- In Hawaii, what is the purpose of a release clause in a blanket mortgage?
- In Hawaii, a 'sale-leaseback' transaction involves:
- In Hawaii, the 'title search period' in escrow is used to:
- In Hawaii, what does 'proration' of property taxes at closing mean for a buyer?
- What is 'notarization' of real estate documents and when is it required in Hawaii?
- What is 'survey' in real estate and what are common types used in Hawaii?
Practice More Hawaii Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Hawaii Quiz →