DVC FIRPTA
a 
company
What we do
At DVC FIRPTA we are dedicated to helping Disney Vacation Club members who are non residents of the United States to understand and complete the required tax forms to avoid or expediate their state tax refund.
The Foreign Investment of Real Property Tax Act or FIRPTA requires non-US resident selling real property to pay taxes on profits from the sale If there no profit from the sale, the seller should apply for a refund. Most DVC sellers receive a partial or full refund.
Can I Avoid This Tax
Yes, if you have a Social Security number. Otherwise you will need to complete some form and submit to the Internal Revenue Service IRS. See the IRS page for more details.
What If I Do Nothing
On closing day, your title Agent is required to withhold 15% of the contract price and send to the Internal Revenue Service. The IRS will hold these fund until you apply for the refund or complete a tax return.
The Best Way
(Before closing)
Assuming no adjusted income , apply for a withholding certificate using form 8288-A. This allows your title agent to forgo sending funds to the state.
For most sellers, this option will not work because the buyers have to provide their social security number.
The 2nd Best Way
(Before closing)
IS THERE MORE TO THIS?
Not really, if you do a google search using the keyword “ firpta “, you will see companies charging from $600 to $2,500 for their services. Of course, they want to show value for their services without sharing their secret sauce with just how easy the process really can be.
We have yet to learn of a DVC member selling their membership and paying any taxes based on today’s market prices and allowed deductions. Use our tool to calculate your estimated tax liability. In simple terms, the formula is (Sales price – Original Purchase price – Broker Commission = Net Taxable Income).
We encourage you to read the details. Most sellers learn about this tax while reviewing their closing statement just days before their closing date. By that time, it is too late to apply for a withholding certificate. Then they are forced to complete form N-288C and wait 3-4 months for a refund. For sellers with little or no equity, being out of pocket for these months can be inconvenient.
WHAT FORMS DO I HAVE TO SUBMIT?
THIS IS NOT A TAX
It is a withholding similar to a deposit to make sure you file and pay the required United States Internal Revenue Tax. The amount withheld is only a rough estimate. When the selling owner subsequently files a federal 1040 tax return, the owner then computes the property tax liability and can then get a refund of any tax previously paid, but that is not owed. FIRPTA is a payment of tax just like wage withholding or estimated taxes would be.
If you have no gain at all on your property sale, you will very likely get ALL of the withheld fee (15% of the sale of the property) back as a refund. If you do owe capital gains, general excise, and transient accommodations taxes, then it is possible that you might actually owe more tax than the amount withheld.