On December 18th, President Obama, signed H.R. 2029, the tax (the “Protecting Americans from Tax Hikes Act of 2015”) and spending bills (Consolidated Appropriations Act, 2016) to fund the government for its 2016 fiscal year.
The December The Act increases the rate of withholding from dispositions of U.S. real property interests under §1445 from 10% to 15%, but remains at 10% for residences sold for less than $1 million.
The withholding exemption where the sale price is under $300,000US and the purchaser will acquire the property as their principal residence is still in effect.
The increase in the withholding tax rate applicable to sale prices of over $1M should cause those taxpayers with losses or nominal gains to apply for a withholding certificate using IRS Form 8288-B to reduce the withholding to an amount equivalent to their effective tax.