<html xmlns:v="urn:schemas-microsoft-com:vml" xmlns:o="urn:schemas-microsoft-com:office:office" xmlns:w="urn:schemas-microsoft-com:office:word" xmlns:m="http://schemas.microsoft.com/office/2004/12/omml" xmlns="http://www.w3.org/TR/REC-html40">
<head>
<meta http-equiv="Content-Type" content="text/html; charset=us-ascii">
<meta name="Generator" content="Microsoft Word 15 (filtered medium)">
<!--[if !mso]><style>v\:* {behavior:url(#default#VML);}
o\:* {behavior:url(#default#VML);}
w\:* {behavior:url(#default#VML);}
.shape {behavior:url(#default#VML);}
</style><![endif]--><style><!--
/* Font Definitions */
@font-face
{font-family:"Cambria Math";
panose-1:2 4 5 3 5 4 6 3 2 4;}
@font-face
{font-family:Calibri;
panose-1:2 15 5 2 2 2 4 3 2 4;}
/* Style Definitions */
p.MsoNormal, li.MsoNormal, div.MsoNormal
{margin:0in;
margin-bottom:.0001pt;
font-size:11.0pt;
font-family:"Calibri",sans-serif;}
a:link, span.MsoHyperlink
{mso-style-priority:99;
color:#0563C1;
text-decoration:underline;}
a:visited, span.MsoHyperlinkFollowed
{mso-style-priority:99;
color:#954F72;
text-decoration:underline;}
span.EmailStyle17
{mso-style-type:personal-compose;
font-family:"Calibri",sans-serif;
color:windowtext;}
.MsoChpDefault
{mso-style-type:export-only;
font-family:"Calibri",sans-serif;}
@page WordSection1
{size:8.5in 11.0in;
margin:1.0in 1.0in 1.0in 1.0in;}
div.WordSection1
{page:WordSection1;}
--></style><!--[if gte mso 9]><xml>
<o:shapedefaults v:ext="edit" spidmax="1026" />
</xml><![endif]--><!--[if gte mso 9]><xml>
<o:shapelayout v:ext="edit">
<o:idmap v:ext="edit" data="1" />
</o:shapelayout></xml><![endif]-->
</head>
<body lang="EN-US" link="#0563C1" vlink="#954F72">
<div class="WordSection1">
<p class="MsoNormal">I ran across a situation today which prompted a question in my mind that I could not readily find an answer for and since my firm on occasion closes the sale of property, I thought I would seek out some better formed opinions.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">ABC, LLC is formed in Washington by Bob and John and has a registered agent service.<o:p></o:p></p>
<p class="MsoNormal">ABC, LLC has no assets.<o:p></o:p></p>
<p class="MsoNormal">ABC, LLC is sold by Bob and John to a pair of foreign investors.<o:p></o:p></p>
<p class="MsoNormal">ABC, LLC purchases a property and flips it.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Does FIRPTA apply to the sale? Is the buyer at risk? The IRS regs are confusing to me and seem to say that it depends on whether or not the LLC is a disregarded entity, treated as a partnership, or treated as a corporation. That is all
well and good when it comes to ultimate liability but it does not allow me to offer any practical advice on how a buyer can protect themselves.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">You can easily complicate the issue with wondering how one finds out that the manager/members of ABC are or are not foreign investors for example and/or go overboard and demand that every LLC disclose its membership and have them all sign
FIRPTA forms prior to a sale. <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Sincerely,<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Richard L. Holland<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><img width="175" height="78" id="Picture_x0020_3" src="cid:image001.jpg@01D060BA.EFCCE2F0" alt="logo-for-print.jpg"><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:10.0pt">733 7th Avenue, Suite 110<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt">Kirkland, WA 98033<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt">425-836-6240 / 425-748-3901 (fax)<o:p></o:p></span></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:9.0pt">The information contained in this communication, and in any attached document(s), is priviledged and/or confidential, intended solely for the individual/entity to whom/which it was sent. If you are not the
intended recipient, you are hereby notified that any dissemination, distribution, or copying of this information is strictly prohibited. If you have received this email in error, please notify me immediately at the email address, mailing address, or telephone
or fax number above.<o:p></o:p></span></p>
<p class="MsoNormal"><o:p> </o:p></p>
</div>
</body>
</html>