40% estate tax due on real estate held by foreigners?

[Josh Walworth]

Hello, 

I'm in the process of purchasing a SFR in Florida from an individual living outside the US. This individual and his deceased wife are both on the title of the home and neither are/were US citizens or legal residents. They purchased the property as a vacation home in 1993 and used it as such until the wife passed away 5 years ago. The death records have all been provided to the title company. We're supposed to be closing this weekend but I just received a call from the title company stating that the closing will likely be delayed because they cannot find record of any estate taxes being paid upon the wife's passing. They also stated the tax would be 40% of an estate over $60,000 but were unsure if that applied to the sales price, the capital gains or the market value so they're attempting to engage a CPA.

Does anyone have experience or expertise in this area? We were just about to cross the finish line with this purchase and I'm afraid this tax issue, if accurate, could cause the seller to walk away. 

Thanks, 

Josh

[Tom Gimer]

Sounds more like FIRPTA issues than estate taxes, but that may also depend upon how title is reflected of record. If you provide the tenancy stated in the deed of record, the purchase price, and then confirm whether or not the buyer intends to reside in the property as his/her/their primary residence and I can post the info that will help clarify this for you.