California Real Estate Withholding

When selling or transferring real estate in California, certain state withholding requirements may apply. California law requires the withholding of a portion of the sale proceeds for tax purposes in some situations. This withholding helps ensure that taxes related to real estate transactions are collected and reported accurately.

Important Notice: The escrow company cannot provide tax advice regarding withholding requirements. For detailed information, please consult the resources below from the California Franchise Tax Board (FTB).

• General Information on Real Estate Withholding
  Learn more about the California real estate withholding process, who is required to withhold, and how to comply. This page provides an overview of the rules and regulations.
  Visit the FTB Real Estate Withholding Page
• Instructions for Form 593
  If you need assistance in completing Form 593, which is required for reporting the amount withheld, the FTB provides detailed instructions. For more information on how to complete Form 593, see:
  Form 593 Instructions, Real Estate Withholding Statement

For additional questions regarding how this might apply to your transaction, we recommend consulting a tax professional directly or referring to the Franchise Tax Board’s resources.