Short answer: As a foreign heir, you can sell an inherited Florida property once the probate court has given the estate’s personal representative authority to act — or once the property has been formally transferred to you. Two pieces of good news: thanks to the “stepped-up basis” rule, income tax on the sale is often minimal, because your tax basis is the property’s market value at the date of death, not the original purchase price. The main special hurdle for non-U.S. sellers is FIRPTA — a withholding of typically 15% of the sale price that the buyer’s closing agent must send to the IRS, which you can reduce or reclaim with the right paperwork.
Step 1: Complete Probate Before You Can Sell
Florida real estate does not pass to heirs automatically. Unless the property was held in a trust or with survivorship rights, a Florida probate proceeding is required to establish who owns it. If the deceased lived abroad and the Florida property was their only U.S. asset, the required proceeding is usually an ancillary probate in the Florida county where the property is located.
The sale itself can happen two ways:
- Sale by the personal representative during probate: the estate sells the property (with court authority where required) and distributes the net proceeds to the heirs. This is often the most practical route for heirs living abroad, since no heir has to appear in the U.S.
- Sale by the heirs after distribution: the property is first deeded to the heirs, who then sell it as owners. With multiple heirs in different countries, every owner must sign the sale documents, which adds logistics (powers of attorney, notarization, apostilles).
Step 2: Understand the Stepped-Up Basis — Your Tax Advantage
For U.S. income tax purposes, inherited property receives a “step-up” in basis: your cost basis becomes the fair market value at the date of the owner’s death. If your relative bought a house for $150,000 decades ago and it was worth $400,000 at death, your basis is $400,000. Sell it soon afterward for $410,000 and the taxable gain is only about $10,000 — not $260,000. This is why heirs who sell within a reasonable time of the death often owe little or no U.S. capital gains tax. An appraisal or well-documented market valuation at the date of death is worth obtaining early.
Step 3: FIRPTA — the Withholding Every Foreign Seller Must Plan For
FIRPTA (Foreign Investment in Real Property Tax Act) requires the buyer to withhold part of the purchase price when the seller is a foreign person and send it to the IRS as a prepayment of the seller’s tax. The standard rates:
| Sale price | Buyer will use as residence | Withholding |
|---|---|---|
| up to $300,000 | yes | 0% (exempt) |
| $300,001 – $1,000,000 | yes | 10% |
| any price | no / not applicable | 15% |
Key points for foreign heirs:
- The withholding is calculated on the gross sale price, not on your actual gain — so with a stepped-up basis, the amount withheld usually far exceeds the tax you really owe.
- You can apply for a withholding certificate (Form 8288-B) before closing to reduce the withholding to the actual expected tax. Because the IRS needs time to process it, this should be started as early as possible — ideally when the property is listed.
- Alternatively, you can let the full amount be withheld and claim a refund by filing a U.S. tax return for the year of sale.
- Each foreign seller needs a U.S. taxpayer identification number (ITIN) for the withholding paperwork and the refund — applying early avoids delays.
Other Costs and Practicalities
- Closing costs: real estate commission (commonly 5–6%, negotiable), title and closing fees, and Florida documentary stamp tax on the deed (customarily paid by the seller).
- Ongoing costs until closing: property taxes, insurance, HOA/condo fees, and maintenance are the estate’s or heirs’ responsibility — budget for them, since probate plus marketing the property takes months.
- Signing from abroad: closing documents can typically be signed abroad before a notary with an apostille, or at a U.S. embassy/consulate; remote online notarization is increasingly available.
- Receiving the money: proceeds can be wired internationally; make sure the estate’s or your own banking details are set up to receive U.S. dollar transfers, and check the tax rules of your home country on inherited assets and their sale.
Frequently Asked Questions
Can we sell the house while probate is still open?
Yes — the personal representative can sell estate property during administration, with court authority where required. In many foreign-heir cases this is the simplest path, because the heirs never have to hold title in their own names.
Do I pay U.S. inheritance tax and capital gains tax on top of each other?
They are separate issues. Any U.S. estate tax is assessed on the estate at death (with a $60,000 exemption threshold for non-resident owners’ U.S. assets), while capital gains tax applies only to the gain when you later sell — which the stepped-up basis usually keeps small. Your home country may also tax the inheritance or the sale; coordinated advice on both sides is essential.
How long does the whole process take?
Plan realistically in months, not weeks: ancillary probate commonly takes several months, and the sale adds marketing and closing time on top. FIRPTA refund processing, if you go that route, adds further months after closing.
What if there are several heirs and one does not cooperate?
If the property has already been distributed to the heirs jointly, all co-owners must join in a voluntary sale; otherwise a partition action may be needed. Selling through the personal representative during probate avoids most of these deadlocks.
This article is for general informational purposes only and is not legal or tax advice. Every estate is different, and FIRPTA and probate deadlines are unforgiving. Our office regularly represents foreign heirs selling inherited Florida property — contact us for a consultation in your own language.
