Can someone explain the FTB withholding for foreign owners in California? I have a foreign owner wanting to rent out a Townhouse in San Jose and I want to make sure he knows what he's getting into. Is the 7% from the Gross Rent or from the Owner's Dispersion? Also, what needs to be withheld for the IRS for a foreign owner?
Here's what my PM recently added to the contract to address IRS withholding. By the same token, 7% FTB withholding will be from gross rents. Here's a link to more info --FTB Decision Chart
Hope this helps.
If Owner is a Foreign Investor (i.e., a nonresident alien individual, a foreign entity,
or other non-U.S. person), Owner authorizes Broker to withhold and transmit to the
Internal Revenue Service thirty percent (30%) of the GROSS rental receipts unless
Owner elects to treat rental income as
Thanks, that's perfect. We mainly do in state owners, so we wanted to make sure we were providing the best service for that 6% management fee.