§ 44-30-71.3 - Sale of real property by nonresidents – Withholding requirements.
SECTION 44-30-71.3
§ 44-30-71.3 Sale of real property bynonresidents – Withholding requirements. – (a) In a sale of real property and associated tangible personal property ownedby a nonresident, the buyer shall deduct and withhold on the payments an amountequal to six percent (6%) of the total payment to nonresident individuals,estates, partnerships or trusts, and nine percent (9%) of the total payment tononresident corporations. For purposes of this section a "nonresidentcorporation" is a corporation that is neither incorporated in this state norauthorized by the secretary of state or board of bank incorporation to dobusiness in this state.
(b) "Total payment" means the net proceeds of the saleactually paid to the nonresident seller including the fair market value of anyproperty to be transferred to the seller.
(c) Every buyer subject to the withholding, deduction andpayment provisions of this section shall be liable for all amounts withheld orrequired to be withheld and the amount required to be withheld under theprovisions of this section shall, until remitted, constitute a lien upon theproperty of the owner.
(d) The buyer shall remit all monies deducted and withheldpursuant to subsection (a) of this section to the tax administrator withinthree (3) banking days of the date of closing on forms prescribed by the taxadministrator. Interest provisions of § 44-1-7 shall be applicable to thissection.
(e) Payments upon which monies were deducted and withheldpursuant to subsection (a) of this section shall be deemed to have been paid tothe tax administrator on behalf of the person from whom it was withheld and theperson shall be credited with having paid that amount for the taxable yearbeginning in that calendar year.
(f) The closing attorney, lending institution, and realestate agent or broker in any transaction governed by the provisions of thissection is not subject to the withholding, deduction, or payment provisions ofthis section.
(g) All forms prescribed by the tax administrator whichrequire recording in the land evidence records shall include the name of thesellers and the street address of the property.
(h) Notwithstanding any other provision of this section tothe contrary, a lien created by the provisions of this section shall cease tobe a lien upon or enforceable against real estate upon the expiration of aperiod of ten (10) years from and after the date of the sale of real propertyand associated tangible personal property which gave rise to the lien.