ITIN for FIRPTA: How a Foreign Seller Without a US Tax ID Gets One via W-7 to Reclaim Withholding
If you're a foreign person selling US real estate, the buyer almost always withholds 15% of the sale price under FIRPTA — and you can't get a dollar of it back until you have a US tax ID. Because you can't get a Social Security number, that ID is an ITIN, and you apply for it on Form W-7. The smart move is to bundle the W-7 with your Form 8288-B withholding-certificate application so the IRS issues the ITIN under Exception 4 first, then everything downstream actually works.
Why "no ITIN" really does mean "no refund"
FIRPTA (the Foreign Investment in Real Property Tax Act) makes the buyer responsible for withholding tax when a foreign person sells a US real property interest. The rate is generally 15% of the amount realized — usually the gross sale price, not your profit (IRS: FIRPTA Withholding). On a $600,000 condo that's $90,000 sitting at the IRS, even if your actual gain was a fraction of that.
That $90,000 is a credit, not a fee. You recover the overheld portion by filing a US nonresident income tax return — Form 1040-NR — and claiming the withholding as a payment. But two documents in that chain both require a US Taxpayer Identification Number (TIN):
- Form 8288-A (Statement of Withholding). The IRS only mails the seller a stamped Copy B of this form once a valid TIN appears on it. The official instructions are blunt: "A stamped copy of Form 8288-A will not be provided to the transferor if the transferor's TIN is not included on that form" (Instructions for Form 8288). No stamped Copy B = no proof of withholding.
- Form 1040-NR. A nonresident return cannot be processed without a TIN in the taxpayer-ID field, and the withholding credit can't be matched to your account without it.
For a foreign individual ineligible for an SSN, that TIN is an Individual Taxpayer Identification Number (ITIN) — a 9-digit number the IRS issues for federal tax purposes only. It doesn't grant work authorization or change immigration status (IRS: ITIN). It is purely the key that unlocks your money.
The 15% isn't lost — but without an ITIN you can't get the stamped 8288-A, and without the stamped 8288-A you can't file the 1040-NR that actually returns your cash. The ITIN is the first domino.
The worked sequence: bundle W-7 with Form 8288-B so the ITIN comes first
You don't have to get the ITIN before the deal and then apply for a refund. The efficient path is to apply for the ITIN as part of your withholding-reduction application, using Form W-7 Exception 4 — "Dispositions by a foreign person of US real property interest." Under Exception 4 you can attach a copy of Form 8288, Form 8288-A, or Form 8288-B as the supporting tax document instead of a full tax return (Instructions for Form W-7).
The standout move is bundling W-7 with Form 8288-B (Application for a Withholding Certificate). The 8288-B asks the IRS to reduce or eliminate withholding to your real expected tax — so you fix the over-withholding at closing instead of waiting a year for a refund. Filing them together means the IRS issues the ITIN first, then processes the certificate against it.
| Step | What you file | What it does |
|---|---|---|
| 1 | Form W-7 + 8288-B together, before closing | Requests the ITIN (Exception 4) and the withholding certificate in one package. |
| 2 | IRS assigns the ITIN | The 9-digit number is issued first (cross-border practitioners commonly see it within ~10 days when bundled this way, well ahead of the standalone 7-week ITIN timeline). |
| 3 | IRS reviews 8288-B | Approves reduced/zero withholding tied to your new ITIN, or denies and the standard 15% applies. |
| 4 | Buyer files Form 8288 + 8288-A | Remits any required tax; your ITIN now appears on the 8288-A. |
| 5 | You receive stamped Copy B of 8288-A | Your proof of withholding — because the TIN is on it. |
| 6 | File Form 1040-NR for the sale year | Claims the withholding as a payment; refund of any over-withheld amount. |
Note on the ~10-day figure: that's a practitioner observation for FIRPTA bundles, not a published IRS service standard. The IRS's official notice window is 7 weeks (9–11 weeks during the January 15–April 30 peak season or from overseas) per the W-7 instructions. Build timelines around the official window and treat anything faster as a bonus.
Mariana, a Mexican citizen with no SSN and no ITIN, is selling a Florida vacation condo for $600,000. Standard FIRPTA withholding would be 15% × $600,000 = $90,000. Her actual gain is small — she bought it for $540,000, so her gain is roughly $60,000 and her real US tax is far below $90,000.
The bundled play: Three weeks before closing, her cross-border CPA files Form W-7 (Exception 4) together with Form 8288-B, attaching her contract and a basis worksheet showing the maximum tax she could owe is about $12,000.
- The IRS issues Mariana's ITIN first.
- It then approves an 8288-B withholding certificate capping withholding near her real liability instead of $90,000.
- At closing the buyer (using their TIN) files Form 8288 remitting the reduced amount, and the 8288-A carries Mariana's ITIN.
- Mariana gets the stamped Copy B and files 1040-NR to true-up.
Net result: roughly $78,000 stays in Mariana's pocket at closing rather than being trapped at the IRS for a year — entirely because the ITIN was secured before money moved. (Figures illustrative; actual tax depends on basis, depreciation recapture and any treaty position.)
Which identity documents the IRS accepts
The W-7 requires proof of both identity and foreign status. The IRS accepts 13 document types, but only one does the whole job alone: a valid passport is the only stand-alone document — it proves identity and foreign status by itself, so you don't have to combine two lesser documents (Instructions for Form W-7). For most adult foreign sellers, the passport route is the cleanest.
You must submit either the original document or a copy certified by the issuing agency — ordinary notarized photocopies are not accepted. Mailing your original passport to the IRS for weeks is understandably unappealing, which is where the agent route comes in.
The Certifying Acceptance Agent (CAA) route
A Certifying Acceptance Agent is an IRS-authorized person or firm that can verify your original passport, certify it for the W-7, and hand the original back to you immediately — so it never leaves your possession by mail (Instructions for Form W-7). CAAs operate both inside and outside the US, which makes them especially useful for sellers living abroad. The one documented limit: a CAA cannot certify foreign military identification cards. For a FIRPTA sale, pairing a CAA with the W-7/8288-B bundle is the standard professional setup.
What if you've already closed without an ITIN?
Plenty of foreign sellers find out about FIRPTA at the closing table — the buyer withholds 15%, files Forms 8288 and 8288-A, and the seller has no TIN. You haven't lost the money, but you've created extra work and a delay:
- Because your TIN wasn't on the 8288-A, the IRS will not automatically send you a stamped Copy B. The Form 8288 instructions state the IRS will instead mail the transferor a letter requesting the TIN and explaining how to get one; once you supply a valid TIN, the IRS then provides the stamped Copy B (Instructions for Form 8288).
- So you apply for the ITIN after the fact on Form W-7 (still Exception 4, attaching your copy of the 8288/8288-A), then wait for the stamped Copy B.
- Only then can you file Form 1040-NR for the sale year to claim the withholding and recover the over-withheld amount.
The penalty for skipping the pre-closing bundle isn't lost money — it's lost time. The 8288-B certificate (which could have reduced withholding at closing) is no longer available after the deal closes, so your full 15% sits with the IRS until the next return cycle. Apply proactively whenever you can.
Hiroshi, a Japanese resident, sold a $400,000 Seattle townhouse and only learned about FIRPTA when escrow withheld $60,000 (15%). He had no ITIN. The buyer filed Form 8288, but because Hiroshi's 8288-A had no TIN, the IRS sent him a letter asking for one. Hiroshi filed Form W-7 (Exception 4) with a certified copy of his passport via a CAA, received his ITIN, then the stamped Copy B. He filed 1040-NR; his actual US tax was about $9,000, so he recovered roughly $51,000 — but a full year after closing instead of at the table.
Both buyer and seller need TINs for Form 8288 to work
FIRPTA is a two-sided ID problem. The seller (transferor) needs a TIN to receive the stamped 8288-A and claim the credit, as shown above. But the buyer (transferee) is the one who must file Form 8288 and remit the tax within 20 days after the transfer date — and Form 8288 asks for the transferee's identifying number too.
A US-citizen buyer simply uses their SSN. But a foreign buyer purchasing from a foreign seller often has no US TIN either — and then they must obtain one (an ITIN via W-7, or an EIN for an entity) so they can lawfully file the 8288. If neither side has a TIN, the withholding gets remitted but the paperwork stalls, and the seller's stamped 8288-A is held up until the missing numbers are supplied. The practical rule: confirm TIN status for both parties early, ideally written into the purchase contract, so nothing blocks the 8288 filing or your downstream refund.
| Party | TIN needed for | If they don't have one |
|---|---|---|
| Foreign seller (transferor) | Stamped 8288-A Copy B + Form 1040-NR refund | Apply for ITIN on W-7 (Exception 4); refund delayed until issued |
| Buyer (transferee) | Filing Form 8288 to remit the withholding | US buyer uses SSN; foreign buyer needs ITIN/EIN to file the 8288 |
- An ITIN is the first domino. Both the stamped Form 8288-A and Form 1040-NR require a US TIN, so no ITIN means no refund of FIRPTA withholding.
- Bundle W-7 with Form 8288-B before closing. Under W-7 Exception 4 the IRS issues the ITIN first, then a withholding certificate can cut the 15% to your real liability at the table.
- A passport is the only stand-alone identity document; use a Certifying Acceptance Agent so you never mail your original.
- If you already closed, the IRS will letter you for a TIN, you apply on W-7, then get the stamped 8288-A and file 1040-NR — slower, but the money is still recoverable.
- Both parties need TINs. The buyer files Form 8288 within 20 days of transfer and needs their own identifying number; a foreign buyer must get an ITIN or EIN too.
- Plan to the official 7-week ITIN window (9–11 weeks in peak season or from overseas) and treat any faster bundled turnaround as upside.
Sources (official)
- IRS — FIRPTA Withholding (15% rate; Forms 8288, 8288-A, 8288-B; $300,000 residence exception)
- IRS — Instructions for Form W-7 (Exception 4, passport as stand-alone document, CAA role, 7-week processing)
- IRS — Instructions for Form 8288 (no stamped 8288-A without the transferor's TIN; 20-day filing; TIN-request letter)
- IRS — Individual Taxpayer Identification Number (ITIN) (what an ITIN is and who needs one)
Frequently asked questions
Can I get the FIRPTA withholding back without an ITIN?
No. The stamped Copy B of Form 8288-A (your proof of withholding) is only issued once a valid TIN is on the form, and Form 1040-NR — the return that claims the credit — can't be processed without a TIN. A foreign individual who can't get an SSN must obtain an ITIN on Form W-7 first.
How long does an ITIN take when bundled with Form 8288-B?
The IRS's official window is 7 weeks to be notified of your application status — 9 to 11 weeks during the January 15–April 30 peak season or if you file from overseas. Cross-border practitioners often see FIRPTA bundles move faster (sometimes ~10 days), but that is an observation, not a published service standard, so plan to the official timeline.
What identity document do I need for the W-7?
A valid passport is the only stand-alone document — it proves both identity and foreign status by itself. You must submit the original or an issuing-agency certified copy, not a notarized photocopy. A Certifying Acceptance Agent can verify your original passport and return it to you immediately so it isn't mailed to the IRS.
I already closed and the buyer withheld 15% — did I lose my refund?
No, but it's slower. Because your TIN wasn't on the 8288-A, the IRS will mail you a letter requesting a TIN and explaining how to get one. You apply on Form W-7 (Exception 4), receive your ITIN, then the stamped 8288-A, and file Form 1040-NR for the sale year to recover any over-withheld amount.
Does the buyer also need a tax ID number?
Yes. The buyer (transferee) must file Form 8288 to remit the withholding within 20 days of transfer, and that form requires the buyer's identifying number. A US buyer uses an SSN; a foreign buyer needs an ITIN or EIN. Confirm both parties' TIN status early so the 8288 filing isn't held up.
What is W-7 Exception 4?
Exception 4 is the FIRPTA category on Form W-7 — "Dispositions by a foreign person of US real property interest." It lets you apply for an ITIN by attaching a copy of Form 8288, 8288-A, or 8288-B instead of a full tax return, which is exactly how you bundle the ITIN application with a withholding-certificate request.
Get the foreign-seller FIRPTA checklist
A free step-by-step list covering the W-7 + 8288-B bundle, document prep, and refund timing.
You're on the list — we'll be in touch.