FIRPTA withholding certificate timing: how long does it take, and can I close before it arrives?

Ninety days is the target, counted from a complete application

Reg. section 1.1445-3(a) commits the IRS to act "not later than the 90th day after it is received," and then defines received as the date "all information necessary for the Service to make a determination is provided." It adds that no certificate will issue without the seller's identifying number.

The IRS withholding certificates page repeats the point: the IRS generally acts within 90 days after receipt of a complete application including the TINs of all parties. A request for more information, or a missing number, effectively restarts the count.

The Form 8288-B instructions add that an application without a specific or estimated date of transfer is not substantially complete and will be rejected, so fill in the expected closing date even if it may slip.

You can close before the certificate arrives if the application is in by closing day

In a deferred exchange, Reg. section 1.1445-3(b)(6) excuses the buyer from paying over within 20 days "only if an application for a withholding certificate is submitted prior to or on the date of transfer." A seller who applies must give the buyer written notice before the transfer with the seller's name, address, TIN, the property and the date the application went in, under Reg. section 1.1445-1(c)(2).

At closing the buyer withholds the full 15% and holds it, usually in escrow by agreement. It then reports and pays over the withheld amount, or the smaller amount the certificate allows, by the 20th day after the IRS mails its final determination.

The IRS guidance on reporting FIRPTA tax warns that if the principal purpose of applying is to delay payment, the buyer owes interest and penalties from the 21st day after the transfer. A genuine 1031 claim is not that, but the application has to substantiate it.

Start the ITIN when the contract is signed, not at closing

A nonresident without a Social Security number needs an ITIN. The IRS FIRPTA questions say an ITIN cannot be requested before there is a legally binding sale contract, but once there is one, Form W-7 can be filed under Exception 4 with the Form 8288-B attached, and an ITIN requested with the certificate application is processed within 10 days.

The same guidance suggests putting the escrow or closing company's details in box 5 of Form 8288-B when the seller lives overseas, so IRS correspondence reaches the closing agent in time. The ITIN steps themselves are on whether you need an ITIN.

Hypothetical calendar: the certificate arrives inside the exchange period

A seller signs a contract, files Form W-7 with Form 8288-B, and the IRS has a complete application on Friday February 20, 2026. Closing is Monday March 2, 2026 on a $1,000,000 sale, so the buyer holds $150,000. Dates and amounts are hypothetical; confirm your own with your intermediary and CPA.

• Day 45, the identification deadline, is Thursday April 16, 2026.
• The IRS's 90th day after receipt is Thursday May 21, 2026, day 80 of the exchange.
• If the certificate is mailed that day, the buyer's payover window closes Wednesday June 10, 2026, and the escrow can release the $150,000.
• Day 180 is Saturday August 29, 2026, so a release directed to the intermediary leaves time to close the last replacement.
• A request for more information in May could push the decision past day 180, which is why the replacement plan should work on $850,000.

If the decision comes late or the money was already remitted

A denial means the buyer pays over within 20 days and you claim the withheld tax as a credit on your US return with the stamped Form 8288-A. If the certificate comes after the exchange period ends and the escrow pays you, that cash is taxable to the extent of gain, the same as leftover cash after an exchange.

If the buyer remitted instead of holding, Reg. section 1.1445-3(g) lets a seller holding a certificate apply for an early refund, without interest, before the return is due. The IRS acts on it within 90 days, and the money comes to you, not your intermediary. The broader withholding rules are on FIRPTA in a 1031 and the paperwork on Form 8288-B at closing.