This section states that the seller agrees to comply with IRS reporting requirements. The seller will be required to inform the escrow company if they are a non-resident alien or a foreign person. If the seller is a foreign person or non-resident alien, the buyer or the escrow company must withhold 10% of the purchase price, unless an exemption applies.
There are a few exemptions, one of them being if the purchase price is under $300,000 and the intention is to use the property as your own residence. Consult a tax professional to see if any of the exemptions apply to you.
For more information about the tax implications of purchasing real property as a non-US citizen, visit the IRS website or www.FIRPTA.com.
