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Norma, a nonresident alien, owns a winter house in Florida. Norma sells the home for...

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Accounting

Norma, a nonresident alien, owns a winter house in Florida. Norma sells the home for $250,000 to a U.S. citizen who will use the house as a personal residence. Which of the following best describes the application of FIRPTA?

1. FIRPTA applies because a residence is a U.S. real property interest.

2. FIRPTA does not apply to sales of personal residence for less than $300,000.

3. FIRPTA imposes a withholding tax equal to 10 percent of the sales price.

4. FIRPTA imposes a withholding tax equal to 30 percent of the sales price.

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