Form Rew-1-1041 - Real Estate Withholding Return For Transfer Of Real Property - 2012 Page 2
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1
2GENERAL INSTRUCTIONS
PURPOSE OF FORM:
36 MRSA § 5250-A requires a buyer to
a certifi cate of waiver stating that no tax is due on the gain from
withhold state income tax when real property located in Maine is
the transfer or that the seller has provided adequate security
acquired from a nonresident of Maine. The buyer must withhold and
to cover the liability;
remit to the state tax assessor 2.5% of the consideration received
c. The consideration for the property is less than $50,000; or,
by the transferor (seller) on the transfer. A completed Form REW-
d. Written notifi cation of the withholding requirements has not
1-1041 (for sellers that are trusts or estates), Form REW-1-1040
been provided to the buyer. The real estate escrow person is
(for sellers who are individuals or sole proprietors), and/or Form
liable for the withholding tax unless it is shown that the failure
REW-1-1120 (for sellers that are corporations) must accompany
to notify is due to reasonable cause.
the remittance.
WITHHOLDING CERTIFICATE ISSUED BY THE STATE TAX
WHO MUST FILE:
A buyer (individual, fi rm, partnership,
ASSESSOR:
A withholding certifi cate may be issued by the state
association, society, club, corporation, estate, trust, business trust,
tax assessor to reduce or eliminate withholding on transfers of
receiver, assignee or any other group or combination acting as a
Maine real property interests by nonresidents. The certifi cate may
unit) of a Maine real property interest who is required to withhold
be issued if:
tax must fi le the appropriate REW-1 forms. If two or more persons
1. No tax is due on the gain from the transfer; or,
are joint transferees, each must withhold the required amount.
However, the obligation of each will be met if one of the joint
2. Reduced withholding is appropriate because the 2.5% amount
transferees withholds and remits to Maine Revenue Services the
exceeds the seller’s maximum tax liability.
total amount required.
If one of the above is applicable, apply for the certifi cate no later
If there are multiple sellers, complete a separate REW-1 form for
than fi ve business days prior to closing.
each seller receiving proceeds from the sale. For example, if the
WHEN TO FILE:
A buyer must report and remit the tax withheld
seller is a partnership, complete a separate REW-1 form for each
to Maine Revenue Services within 30 days of the date of transfer
partner receiving proceeds from the disposition. If the partners are
of the property.
individuals, complete forms REW-1-1040. Be sure to complete the
appropriate REW-1 form for each seller: REW-1-1040 (individuals,
WHERE TO FILE:
Send Form REW-1-1041 with payment directly
sole proprietors), REW-1-1041 (trusts, estates), REW-1-1120
to: Maine Revenue Services, Income/Estate Tax Division-REW,
(corporations).
P.O. Box 9101, Augusta, ME 04332-9101 (do not send payment or
Form REW-1-1041 with the real estate transfer tax form). Provide
EXCEPTIONS:
The buyer is not required to withhold or fi le this
one copy of Form REW-1-1041 to the real estate escrow person,
return if any of the following applies:
one copy to the buyer, and two copies to the seller.
a. The seller furnishes to the buyer written certifi cation stating,
under penalty of perjury, that as of the date of transfer the
seller is a resident of Maine;
b. The seller or the buyer has received from the state tax assessor
SPECIFIC INSTRUCTIONS
Block 1.
Check the appropriate space to indicate the type of
rental property, commercial, or vacant land.
seller.
Block 10.
Enter the date the property was acquired by the seller.
Block 2.
Enter the name of the seller.
Block 11.
Check the appropriate space to indicate the amount
Block 3.
Enter seller’s social security number (estate) or federal
withheld. If the parties obtained a withholding certifi cate
ID number (trust).
from the state tax assessor authorizing a reduced rate
of withholding, enter the certifi cate number and attach a
Block 4.
Enter the address of the seller.
copy of the certifi cate to this return.
Block 5.
Enter name and telephone number of the tax matters
Block 12.
Enter the dollar amount withheld for the seller in block
contact person or fi rm.
2.
Block 6.
Enter the date of this transfer.
Block 13.
Enter the name of the withholding agent (buyer).
Block 7.
Enter the total consideration (see 36 MRSA § 5250-
Block 14.
Enter the address of the withholding agent (buyer).
A(1)(A) for defi nition).
Block 15.
Enter the social security number or federal ID number of
Block 8.
Enter the percentage of total proceeds received by this
the withholding agent (buyer).
seller.
Block 9.
Enter the location of the property, including town and
street address. Specify use before the transfer, such
as principal residence, vacation home, condominium,
The seller must attach a copy of the REW-1 form to
the Maine income tax return to ensure proper credit
for real estate withholding paid.
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