Withholding Tax refers to paying 30% of the gross amount of rent received by a foreign landlord to the IRS. For example, for a landlord receiving $1000 in rent, this tax would amount to $300, which many foreign landlords find burdensome. However, it is possible to avoid this tax. You should file an income tax return for the year in which you earned rental income using Form 1040NR and apply for an ITIN from the IRS the following year. Contact us for more information about the process.