Navigating the tax implications and legal requirements involved in the sale of real estate by nonresidents in South Carolina involves understanding various statutory provisions, among which the form I-295 plays a crucial role. Specifically designed for nonresident sellers, this form is a seller’s affidavit under the South Carolina Code Section 12-8-580, created to ensure compliance with state tax withholding requirements on real estate transactions. It encompasses declarations by the seller regarding their residency status, a description of the property being sold, the seller's obligation to file a South Carolina income tax return, and other pertinent details reflecting the complexity of tax law and its implications on real estate transactions. Importantly, the form serves to potentially relieve the buyer from the responsibility of withholding part of the sale proceeds for tax purposes, contingent upon accurately meeting conditions as outlined in SC Revenue Ruling #09-13. This ruling, along with the advisories provided, forms the backbone of understanding how withholding requirements can be navigated or nullified under specific circumstances, such as sales involving tax-exempt organizations, installment sales, principal residence sales, involuntary conversions, like-kind exchanges, and employee relocation scenarios. Notably, this document must be read and understood in conjunction with the applicable Advisory Opinion, emphasizing its role as not just a form but as a critical affidavit bearing legal weight in real estate transactions within South Carolina.
| Question | Answer |
|---|---|
| Form Name | Form I 295 |
| Form Length | 2 pages |
| Fillable? | No |
| Fillable fields | 0 |
| Avg. time to fill out | 30 sec |
| Other names | I295 form i 295 |
1350
STATE OF SOUTH CAROLINA
DEPARTMENT OF REVENUE
SELLER'S AFFIDAVIT NONRESIDENT SELLER WITHHOLDING
S.C. Code Section
(Rev. 6/25/10)
3278
This is an affidavit of facts. Whether or not this affidavit is sufficient to relieve the buyer of the responsibility to withhold is governed by SC Revenue Ruling
The undersigned on oath, being first duly sworn, hereby certifies as follows:
1.This affidavit is being given in connection with a sale of real estate pursuant to SC Revenue Ruling
2.I have attached to this affidavit a description of the real property and any tangible personal property being sold as a part of this
sale. The real property is located in the county of |
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and its tax map number(s) is |
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3.The undersigned is the seller of the property described in the attached description.
4.The closing date of this sale is
5.The Seller's name is
6.The Seller's address is
(number, street or rural route)
(city, state and zip code)
7.The Seller's Social Security Number (SSN) or Federal Employer Identification Number (FEIN) is
8.The undersigned acknowledges his obligation to file a South Carolina income tax return for the year of sale.
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14.
Resident. The seller is a resident of South Carolina, as that term is defined in the South Carolina income tax laws (Code Section
Deemed Resident (must be a business). Pursuant to Code Section
1.a. The seller is a corporation incorporated outside South Carolina, has its principal place of business in South Carolina, and does no business in its state of incorporation, or
b.The seller (i) has been in business in South Carolina during the last two taxable years, including the year of sale, (ii) will continue substantially the same business in South Carolina after the sale, (iii) is not delinquent with respect to filing any South Carolina income tax returns, (iv) has filed at least one South Carolina income tax return, and (v) has a certificate of authority to do business in South Carolina or is registered to do business in South Carolina and
2.The seller agrees to report the sale on a timely filed South Carolina income tax return.
Gain Amount. The seller affirms pursuant to Code Section
on this transaction and on which buyer is to make the requisite withholding will not exceed $ |
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Withholding Amount Equals Entire Net Proceeds. If the withholding amount is limited to the entire net proceeds, any lien, mortgage or credit line advance which was made within one year prior to the closing was not made in contemplation of the sale. See Question and Answer 15 in SC Revenue Ruling
Installment Sale.
The seller will report this sale on the installment method for South Carolina income tax purposes, and has attached an amortization schedule correctly designating the principal and interest portions of the payments. If withholding is to be limited to the gain, the seller has entered the gain amount in item 12.
The seller elects out of the installment sale method for South Carolina purposes and will report the entire withholding in one payment. If withholding is to be limited to the gain, the seller has entered the gain amount in item 12.
Retain for your records. DO NOT mail to the Department of Revenue.
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15.
Principal Residence or Involuntary Conversion - Nonrecognition of Gain. The sale of the property will not be subject to taxes because of Internal Revenue Code Section 121 (sale of a principal residence) or Internal Revenue Code Section 1033 (involuntary conversions.) If the seller fails to comply with Section 1033, the seller acknowledges an obligation to file an amended South Carolina income tax return for the year of the sale.
16.
17.
Like Kind Exchange.
In a simultaneous exchange, the entire gain is deferred under Internal Revenue Code Section 1031.
A gain will be partially recognized. Enter the gain amount in item 12.
The gain is intended to be deferred under Internal Revenue Code Section 1031 using a qualified intermediary and the steps required by SC Revenue Ruling
Employee Relocation. The transaction involves the sale of an employee's property which is being sold by an employer or relocation company in connection with the employee's transfer. For income tax purposes the sale is treated as a sale by the employer or relocation company.
The undersigned understands that this affidavit may be disclosed to the Department and that any false statement contained herein could be punished by fine, imprisonment, or both.
(Signature) |
(Name - Please Print) |
If the person making the affidavit is not the Seller, complete the following:
(Affiant's SSN or FEIN)
(Affiant's number, street or rural route)
(Affiant's city, state and zip code)
SUBSCRIBED AND SWORN to
Before me this |
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day of |
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, year of
(Notary Public)
My Commission Expires:
Social Security Privacy Act Disclosure
It is mandatory that you provide your social security number on this tax form if you are an individual taxpayer. 42 U.S.C 405(c)(2)(C)(i) permits a state to use an individual's social security number as means of identification in administration of any tax. SC Regulation
The Family Privacy Protection Act
Under the Family Privacy Protection Act, the collection of personal information from citizens by the Department of Revenue is limited to the information necessary for the Department to fulfill its statutory duties. In most instances, once this information is collected by the Department, it is protected by law from public disclosure. In those situations where public disclosure is not prohibited, the Family Privacy Protection Act prevents such information from being used by third parties for commercial solicitation purposes.
Our Internet address is: www.sctax.org
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