Many Dahlonega homes belong to owners who live somewhere else. If that is you, Georgia’s withholding rule can take a real bite out of the cash you see at closing, even though it is a prepayment toward tax and not a fee. Here is how the rule works, the ways around it that the law spells out, and the federal rule people often confuse it with.
The Georgia rule
O.C.G.A. 48-7-128
- When a nonresident of Georgia sells Georgia real property, the buyer generally must withhold 3 percent of the purchase price and send it to the Georgia Department of Revenue. O.C.G.A. 48-7-128 (2025 Georgia Code), via Justia, checked 2026-10-19
- A buyer who fails to withhold Georgia's nonresident tax when required is personally liable for it. O.C.G.A. 48-7-128 (2025 Georgia Code), via Justia, checked 2026-10-19
The duty sits with the buyer, and a buyer who skips it is on the hook personally. That is why closing attorneys ask every seller about residency. As an illustration on an example price, 3 percent of a $400,000 sale is $12,000.
Withholding on the gain instead of the price
A nonresident seller can give the buyer a sworn affidavit of the gain, and the buyer then withholds 3 percent of the gain instead of the price. (O.C.G.A. 48-7-128 (2025 Georgia Code), via Justia, checked 2026-10-19)
The Department of Revenue’s form for this is the IT-AFF2, the affidavit of seller’s gain. As an illustration with example numbers: if the affidavit states a gain of $90,000, 3 percent of the gain is $2,700, instead of 3 percent of the full price. Working out your gain is a tax question; get help from a tax professional before you sign a sworn statement.
When no withholding is required
Thresholds and exemptions
- Georgia DOR's rule says no nonresident withholding is required when the purchase price is less than $20,000. Ga. Comp. R. & Regs. r. 560-7-8-.35 (Georgia DOR rule), via Cornell LII, checked 2026-10-19
- Georgia's nonresident withholding does not apply when the property is the seller's principal residence, in foreclosure or deed-in-lieu transfers with no extra consideration, or when certain government agencies or Fannie Mae, Freddie Mac or Ginnie Mae are a party. O.C.G.A. 48-7-128 (2025 Georgia Code), via Justia, checked 2026-10-19
A seller who meets listed conditions (such as having filed Georgia returns for the two prior years) and signs a sworn affidavit is treated as a Georgia resident for this withholding. (O.C.G.A. 48-7-128 (2025 Georgia Code), via Justia, checked 2026-10-19)
The Department’s example residency affidavit is the IT-AFF1. Whether a home counts as your principal residence under the statute, or whether you qualify to be treated as a resident, depends on your own tax history. We do not explain how those tests apply; a tax professional can.
The form and the deadline
The buyer reports and pays Georgia's nonresident withholding on Form G2-RP, due by the last day of the month after the month of closing. (Georgia Department of Revenue, Form G2-RP (Rev. 06/01/23), PDF, checked 2026-10-19)
The current form is on the Department of Revenue’s site: Form G2-RP. In practice the closing attorney’s office withholds the amount from the seller’s proceeds and sends it with the form.
FIRPTA is federal and separate
Federal FIRPTA withholding
- Under federal FIRPTA rules, buyers of U.S. real property from foreign persons generally must withhold 15 percent of the amount realized. Internal Revenue Service, FIRPTA Withholding page (last reviewed or updated 21-Jul-2026), checked 2026-10-19
- No FIRPTA withholding is required when the buyer, an individual, acquires the home as a residence and the sales price is not more than $300,000. Internal Revenue Service, Exceptions from FIRPTA Withholding page (last reviewed or updated 15-Jul-2026), checked 2026-10-19
- The IRS says reduced FIRPTA withholding can apply when the buyer acquires the home as a residence and the amount realized is between $300,000 and $1 million. Internal Revenue Service, FIRPTA Withholding page (last reviewed or updated 21-Jul-2026), checked 2026-10-19
FIRPTA is about foreign persons, not people who live in another state. An American who lives in Florida and sells a Lumpkin County home deals with the Georgia rule, not FIRPTA. A foreign seller can face both. The IRS describes a reduced FIRPTA withholding for some residences between the two price points above but, on the pages we read, does not state the reduced rate, so we do not print one. See the IRS pages on FIRPTA withholding and its exceptions.
| Georgia nonresident withholding | Federal FIRPTA | |
|---|---|---|
| Who it is about | Sellers who are not Georgia residents | Sellers who are foreign persons |
| Who must withhold | The buyer | The buyer, certain agents and settlement officers |
| Paid to | Georgia Department of Revenue | Internal Revenue Service |
What to do before you list
- Tell your agent and the closing attorney early that you live outside Georgia.
- Ask a tax professional whether an exemption, the residency affidavit or the gain affidavit fits your sale.
- Expect the closing attorney to ask for the affidavit before closing, not at the table.
- Plan your net proceeds with the withholding in mind. The estimator has an “anything else” line you can use for it, and closing costs for sellers covers the rest of the seller sheet.
- If you will not be at the closing in person, read remote and power of attorney closings.
Questions buyers ask
Is Georgia withholding required on a sale under $20,000?
No. The Department of Revenue's rule says no nonresident withholding is required when the purchase price is less than $20,000.
Source: Ga. Comp. R. & Regs. r. 560-7-8-.35 (Georgia DOR rule), via Cornell LII
When is the Georgia withholding due after closing?
The buyer reports and pays it on Form G2-RP by the last day of the month after the month of closing. In practice the closing attorney's office usually handles it.
Source: Georgia Department of Revenue, Form G2-RP (Rev. 06/01/23), PDF
Can an out-of-state seller be treated as a Georgia resident for withholding?
Yes, if the seller meets the conditions the statute lists, such as having filed Georgia returns for the two prior years, and signs a sworn affidavit saying so. A tax professional can tell you whether you qualify.
What happens if the buyer doesn't withhold Georgia nonresident tax?
A buyer who fails to withhold Georgia's nonresident tax when required is personally liable for it. That is why closing attorneys ask every seller about residency.
Does FIRPTA apply to a $300,000 home sold by a foreign owner?
Not if the buyer is an individual who acquires it as a residence and the sales price is not more than $300,000. Other FIRPTA conditions still apply, so ask a tax professional.
Before you rely on this
This page is education, not legal advice. Dahlonega Closing Guide is published by Gold Peach Realty, a real estate brokerage, not a law firm. For advice about your own contract, title or taxes, ask a Georgia attorney or a tax professional.
Education, not legal advice. Statutes, fees and forms change; every rule on this page links to the law or office that sets it. Your closing attorney and your contract decide what applies to your closing.
