30-day extension for a foreign seller to apply for FIRPTA withholding certificates

Plain-English summary

When a foreign person sells a "US real property interest" (which includes shares of a
US real property holding corporation), the FIRPTA rules in § 1445 generally require the
buyer to withhold 15% of the sale price and remit it to the IRS. A seller can reduce or
eliminate that withholding by obtaining a "withholding certificate" from the IRS,
applied for on Form 8288-B. Here a foreign publicly traded corporation and its foreign
subsidiary sold their shares in a US real property holding corporation (in a
transaction they treated as a reorganization) and realized losses, so they expected
little or no US tax and wanted withholding certificates. Their in-house tax staff had
limited US tax experience, and because of misunderstandings with their outside tax
advisors, the Forms 8288-B were not filed on time. They asked the IRS for relief under
Treas. Reg. § 301.9100-3. Finding that they acted reasonably and in good faith (they
relied on qualified tax professionals) and that relief would not prejudice the
government, the IRS granted a 30-day extension to file the Forms 8288-B. The IRS
cautioned that the extension is not a determination that they actually qualify for the
certificates.

Ruling snapshot

• Question: Should foreign sellers who missed the deadline get an extension to apply for FIRPTA withholding certificates (Forms 8288-B)?
• Outcome: Approved (30-day extension granted under § 301.9100-3)
• Key authorities: IRC § 1445(a), (c)(1)(A); Treas. Reg. § 1.1445-3; Treas. Reg. §§ 301.9100-1, 301.9100-3; IRC § 897(c)(2)

Full text (IRS public release)

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 Internal Revenue Service                                       Department of the Treasury
                                                                Washington, DC 20224

 Number: 202629003                                              [Third Party Communication:
 Release Date: 7/17/2026                                        Date of Communication: Month DD, YYYY]
 Index Number: 9100.00-00, 1445.04-01
                                                                Person To Contact:
 ----------------------                                         ----------------, ID No. -----------------
 ------------------------                                       Telephone Number:
 ------------------------------------                           --------------------
 ---------------                                                Refer Reply To:
                                                                CC:INTL:BR 4
                                                                PLR-115112-25
                                                                Date:
                                                                April 13, 2026


TY: -------

Legend

 Taxpayer                      = ------------------------------------------------

 Country 1                     = --------

 Domestic Subsidiary           = ----------------------------------------------------

 Country 1 Subsidiary = ----------------------------------------------------------------

 Acquiror                      = ---------------------------------------------------

 City 1                        = --------

 Tax Advisors                  = --------------------------

 Individual A                  = ----------------------

 Date 1                        = -------------------------

 Date 2                        = --------------------------

 State 1                       = ------
                                             2
PLR-115112-25
Dear ---------------:

This is in response to letters dated July 18, 2025 and March 18, 2026 submitted on
behalf of Taxpayer and Country 1 Subsidiary by an authorized representative
requesting a ruling under Treas. Reg. § 301.9100-3 for an extension of time to request
withholding certificates from the Internal Revenue Service by filing Forms 8288-B.

The ruling contained in this letter is based upon information and representations
submitted by Taxpayer and accompanied by a penalties of perjury statement executed
by an appropriate party. While this office has not verified any of the material submitted
in support of the request for ruling, it is subject to verification on examination.

FACTS

Prior to Date 1, Taxpayer, a Country 1 publicly traded corporation, directly owned 50%
of the shares of Domestic Subsidiary, a domestic corporation which was a United States
real property holding corporation as defined in section 897(c)(2). Country 1 Subsidiary,
a Country 1 corporation wholly owned by Taxpayer, owned the remaining 50% of the
shares of Domestic Subsidiary. On Date 1 and Date 2 respectively, Taxpayer and
Country 1 Subsidiary (“Taxpayers”) each sold all of their shares of Domestic Subsidiary
to Acquiror, a wholly owned domestic subsidiary of Taxpayer, for cash in the amount of
the fair market value of the Domestic Subsidiary shares. As part of the same plan,
Domestic Subsidiary then converted to a State 1 limited liability company. Taxpayer
took the position that the sale of the shares and the conversion of Domestic Subsidiary
were, together, characterized as a reorganization described in section 368(a)(1)(D)
(“Reorganization”).

Taxpayer and Country 1 Subsidiary both realized losses on the disposition of their
shares in Domestic Subsidiary pursuant to the Reorganization. As a result, Taxpayers
believed that they were eligible to apply for a certificate to exempt them from
withholding by filing Forms 8288-B.

Prior to Date 1, Taxpayer’s tax personnel consisted of one senior manager and one staff
member. The tax personnel were located in City 1, a major city in Country 1, and had
limited experience regarding U.S. federal income tax, and no experience regarding
sections 897 and 1445 prior to discussions relating to the transaction.

To assist with the U.S. federal income tax analysis of the sale of Domestic Subsidiary,
Taxpayer engaged Tax Advisors. Due to misunderstandings between Taxpayers and the
Tax Advisors, completed Forms 8288-B were not timely filed. The specific facts that led
to the failure to timely file Form 8288-B are detailed in the affidavit of Individual A, the
General Manager of Taxpayer. Accordingly, Taxpayers are applying for an extension of
time under Treas. Reg. § 301.9100-3 to request withholding certificates by filing Forms
8288-B.
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PLR-115112-25
RULING REQUESTED

Taxpayers request that an extension of time be granted under Treas. Reg. § 301.9100-3
for Taxpayers to request withholding certificates from the Internal Revenue Service on
the disposition of their shares of Domestic Subsidiary pursuant to the Reorganization by
filing Forms 8288-B.

LAW
Section 1445(a) provides that except as otherwise provided in section 1445, in the case
of any disposition of a United States real property interest by a foreign person, the
transferee shall be required to deduct and withhold a tax equal to 15 percent of the
amount realized on the disposition. Section 1445(c)(1)(A) provides that the amount
required to be withheld with respect to any disposition shall not exceed the transferor's
maximum tax liability.

Treas. Reg. § 1.1445-3 provides rules intended to fulfill the requirements of section
1445(c), pursuant to which withholding under section 1445(a) may be reduced or
eliminated upon the issuance of a withholding certificate by the Internal Revenue
Service.

Treas. Reg. § 1.1445-3(a) provides that a withholding certificate that is obtained prior to
a transfer notifies the transferee that no withholding is required.

Treas. Reg. § 301.9100-1(b) defines a regulatory election as an election whose due
date is prescribed by a regulation, a revenue ruling, revenue procedure, notice, or
announcement.

Treas. Reg. § 301.9100-1(c) provides that the Commissioner has discretion to grant a
taxpayer a reasonable extension of time under the rules set forth in § 301.9100-3 to
make a regulatory election under all subtitles of the Internal Revenue Code except
subtitles E, G, H, and I.

Treas. Reg. § 301.9100-3(a) provides that requests for relief will be granted when the
taxpayer provides the evidence (including affidavits described in Treas. Reg. §
301.9100-3(e)) to establish to the satisfaction of the Commissioner that the taxpayer
acted reasonably and in good faith, and the grant of relief will not prejudice the interests
of the Government.

Treas. Reg. § 301.9100-3(b)(1)(v) provides that unless the taxpayer is deemed to have
not acted reasonably and in good faith under Treas. Reg. § 301.9100-3(b)(3), a
taxpayer is deemed to have acted reasonably and in good faith if it reasonably relied on
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PLR-115112-25
a qualified tax professional, and the tax professional failed to make, or advise the
taxpayer to make, the election.

CONCLUSION

Based on the information submitted and representations made with Taxpayers’ ruling
request, we conclude that Taxpayers satisfy the requirements of Treas. Reg. §
301.9100-3(a). Accordingly, Taxpayers are granted extensions of time until 30 days
from the date of this ruling letter to request from the Internal Revenue Service
withholding certificates described in Treas. Reg. § 1.1445-3 for the dispositions of their
shares of Domestic Subsidiary pursuant to the Reorganization.

Except as expressly provided herein, no opinion is expressed or implied concerning the
tax consequences of any aspect of any transaction or item discussed or referenced in
this letter. Specifically, an extension of time to submit an application for a withholding
certificate is not itself a determination that Taxpayers are eligible to receive withholding
certificates.

This ruling is directed only to the taxpayers requesting it. Section 6110(k)(3) of the
Code provides that it may not be used or cited as precedent.

A copy of this letter must be attached to any request for a withholding certificate
submitted to the Internal Revenue Service and to any other subsequent relevant forms
or returns to which it is relevant.

In accordance with the Power of Attorney on file with this office, a copy of this letter
ruling is being sent to your authorized representative.


                                                   Sincerely,

                                                             /s/      _

                                                   Kenneth A. Jeruchim
                                                   Senior Technical Reviewer, Branch 4
                                                   Associate Chief Counsel (International)

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