Form 8938 versus FBAR threshold checker
Test your foreign assets against both US reporting thresholds at once.
Open itA foreign seller of United States real property has tax withheld on the gross price, not on the profit. This applies the statutory rate for your facts, works out the tax actually due on the gain, and shows what a withholding certificate would release.
The disposition
US$
The gross price. This is the base withholding is applied to.
This is what opens the reduced and zero rate bands. It is the buyer's intended use, not the seller's.
US$
Purchase price plus capital improvements, less depreciation claimed.
US$
Commission, legal fees, transfer taxes and closing costs.
%
Your own figure. Long-term and short-term gains, depreciation recapture and state tax all pull this in different directions.
%
Leave at zero to use the statutory rate. Enter the rate a granted certificate specifies.
Over-withheld at closing
—
Withholding rate applied —
Inside the residence exemption band —
Statutory rate on these facts—
Which band applies—
Withheld at closing—
Gain on the sale—
Tax actually due on the gain—
Shortfall, if the withholding is too little—
What a withholding certificate is worth—
Net proceeds at closing—
Net proceeds with a certificate—
Three rates, and the buyer decides which one applies
Withholding on a disposition of United States real property by a foreign person runs at fifteen per cent of the amount realised as the standard rate. Two reduced bands exist and both depend on the buyer acquiring the property for use as a residence: no withholding where the amount realised is not more than 300,000 dollars, and ten per cent where it is more than that but not more than one million dollars.
Note what the bands turn on. It is the buyer's intended use of the property, not the seller's circumstances, and the seller cannot elect into a band. The calculator applies the band your inputs describe and names it, so you can see which one you are in before the closing statement is drafted.
The certificate is the remedy, and it has to be early
Withholding is on the gross price, so on a property that has not risen much — or has fallen — the withholding can exceed the entire tax. The remedy is an application for a withholding certificate, which asks the tax authority to reduce the amount withheld to the tax that will actually be due. Granted, it releases the difference at closing rather than a year later on the return.
The application takes time and it has to be filed by the day of the transfer at the latest, so it belongs in the timetable next to the sale agreement rather than in the closing checklist. Where it is not obtained, the over-withheld amount is claimed back on a United States return for the year — which means the seller needs a taxpayer identification number before anything can move.
Worked example
A Canadian resident sells a Florida condominium for 700,000 dollars. Adjusted basis is 420,000 and selling costs are 45,000. The buyer is an investor, not a resident purchaser.
- No residence band applies, so fifteen per cent of 700,000 is withheld — 105,000.
- The gain is 235,000. At a 20% effective rate the real tax is 47,000.
- The over-withholding is 58,000, which a granted certificate would have released at closing instead of on the return.
Tick the residence box and the band drops to ten per cent, cutting the withholding by a third with no change to the tax. That single fact about the buyer is worth 35,000 of cash flow here.
What this calculator assumes
- The rates and the two band figures are the current statutory ones, prefilled and cited below. The effective rate on the gain is yours to enter, because it depends on holding period, depreciation recapture and state tax.
- Depreciation recapture is not separated out. Where a rental property has been depreciated, part of the gain is taxed at a different rate and the blended figure you enter should reflect that.
- State withholding and state income tax are additional in several states and are not modelled.
- A partnership, trust or corporate seller, and dispositions of interests in entities rather than property, follow different rules.
An estimate, not advice. This is an estimate built from what you typed, not advice on your file. Nothing here reads your documents, checks your treaty article or looks at the year you are actually in. Where the number matters, we agree a fixed fee in writing before any work starts.
Where these figures come from
- current guidance FIRPTA withholding — IRS
- current guidance Exceptions from FIRPTA withholding — IRS
- current guidance Withholding certificates — IRS
Any figure prefilled in the panel above is stated with the year it belongs to and can be changed. Rates and thresholds move; a calculator that asks you for the current one stays right, and one that hides a guess does not.
Files that look like this one
Case study 1
Putting a Foreign Hire on a Canadian Payroll
The obligation sits on the payer, and the payer is liable for what it failed to withhold. Registration, the residence question and any treaty exemption are settled before the first pay run rather than after.
Read how this one runs
Case study 2
Three Account Types, Three Tax Answers
Interest on each is treated differently and the deduction at source follows the account rather than the person. Holding the wrong one for the purpose is a recurring and avoidable cost.
Read how this one runs
Case study 3
Tax Deducted When Buying From an NRI
Withholding on a sale by a non-resident is applied to the sale value rather than to the gain, so it routinely exceeds the tax due. A lower-deduction certificate obtained before completion avoids locking the difference up.
Read how this one runs
Case study 4
Three Countries in One File and Two Treaties That Disagree
Income sourced in one country, paid to a resident of a second, held through an entity in a third: three bilateral treaties, no three-way rule. The analysis works out which pair governs each flow, and whether the middle entity is entitled to anything at all.
Read how this one runs
Case study 5
A Canadian Property Sale Held Up for a Clearance Certificate
When a non-resident sells Canadian real estate the purchaser must hold back a portion of the price until the seller produces a certificate. The file applies for it on the correct basis and works to the closing date, because the holdback is released against the certificate, not against the sale.
Read how this one runs
Case study 6
First Canadian Return After Arriving Mid-Year
The arrival date splits the year and sets the cost base of what you brought with you. Getting that date and those values right is what determines whether a later sale is taxed on the whole gain or only on the part that accrued after landing.
Read how this one runs
Case study 7
Information Returns Missed Behind a Correct Return
The heaviest exposure on a cross-border file is often a disclosure form rather than the tax. Where the return itself was right, the procedures for late information returns turn on a reasonable-cause narrative with dates and documents behind it.
Read how this one runs
Case study 8
One Salesperson Abroad, and a Corporate Filing Obligation
A single employee with authority to conclude contracts can create a taxable presence for the whole company. The review tests what the person actually does against the treaty article, and where a presence exists, works out what profit is attributable to it.
Read how this one runsAll case studies — every published engagement in one place.
Core International & Cross-Border Tax Services
International Tax Planning & Advisory
Strategy and compliance for income, assets and families spread across borders.
One coordinating team: filings on every side of the border are sequenced so treaty relief and foreign tax credits are claimed once — and in the right country.
U.S. & Cross-Border Tax Returns
Dual filers: U.S. citizens in Canada and Canadians with U.S. income run two parallel systems — we prepare both, in the right order, every year.
Expat & Emigration Tax
The move year is its own project: the elections and valuations filed that year decide the next decade of both countries’ returns.
Non-Resident Canadian Tax
Default withholding is 25% of gross: elective returns routinely turn over-withheld rent and pensions into refunds.
Transfer Pricing & BEPS
Documentation prepared with the return is the cheapest insurance in international tax; reconstructing it during an audit is the most expensive.
Tax Treaties & Withholding
Relief is only as good as the paperwork claiming it — we build treaty positions that survive review on both sides.
Cross-Border Estates & Trusts
Wills drafted for one country routinely misfire in the other — deemed disposition here, estate tax there, credits in between.
Global Investments & Reporting
Information returns carry the sharpest penalties — $25 a day whether or not any tax is owing. We keep them clean and on time.
Cross-Border Corporate Tax
Expansion raises the same four questions every time — entity, PE, repatriation, payroll. We answer them before the tax authorities do.
India Tax for NRIs & Returning Residents
The deduction is taken on the sale price, not the gain — which is why an NRI property sale strands cash unless the certificate is applied for before closing.
Canadian Tax with a Foreign Element
Residency is decided on facts, not on a form — and the year you arrive or leave is the one where the largest amounts turn on the smallest details.
UAE Tax for Expats & Their Home Country
A zero-tax country is only half the answer — the question that decides the bill is whether the country you came from still treats you as resident.
Industries & Client Types We Serve Worldwide
Global E-commerce & Marketplaces
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Professional Services Firms
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Cross-Border Real Estate
- Section 216 rental returns
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Importers, Exporters & Manufacturers
- Transfer pricing documentation (s.247)
- Customs value vs transfer price
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Athletes, Artists & Entertainers
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Remote Workers & Digital Nomads
Working from anywhere doesn't mean taxed nowhere: residency defaults, employer payroll exposure and treaty relief decide where income actually lands.
Working from another country does not by itself end tax residence in the one you left, and it can start one where you are sitting. Day counts, ties, the employer's own exposure and the treaty tie-breaker all point at the same question, and the year you move is the year it has to be answered on paper.
- Residency analysis before moving
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Investment Funds & Holding Companies
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