Florida Taxes

Did you know Florida is one of only seven states that do not tax individual wage income? Florida does not impose person income, inheritance, gift taxes or intangible personal property taxes. Howerver, there are other taxes and fees that, in certain counties or circumstances, Florida residents may be required to pay. 

If you purchase a home in Florida, you will pay ad valorem or "property" tax based on the taxable value of the property.  Ad valorem taxes are assessed by the county property appraiser and collected annually by the exemption and cap on assessed value is available to homewoners who meet certain requirements. 

Visit the Florida Department of Revenue site at dor.myflorida.com for more tax information.

  • Sales & Use Tax

Florida’s sales tax is 6%, however each county is able to impose an additional sales tax. Sarasota County levies an additional 1% sales tax totaling 7% and Manatee County levies an additional .5% totaling a 6.5% sales tax. Sales and use tax is also applied to tangible property and leases under 6 months, as well as commercial rent. No sales tax is owed on residential leases over 6 months in term. Florida is the only state in the United States to impose a sales tax on rents. Currently, the tax is imposed at the rate of 6 percent in every county except Miami-Dade, which fixes the rate at 7 percent.

The tax imposed on commercial property leases is not limited to the base rent; sales tax is also imposed and calculated on any additional rent, including a tenant’s share of common area maintenance (CAM) charges, real property taxes, insurance, and just about all other charges or consideration required or paid by a tenant under the terms of a lease. The good news is that on May 25, 2017 Governor Rick Scott signed House Bill 7109, which beginning January 1, 2018 reduces the general state-level tax on rents (sometimes commonly referred to as the business rent tax), from 6 percent to 5.8 percent (a 3.33% reduction).  This reduction applies to rent payments due and payable for occupancy periods beginning January 1, 2018. Rent payments tendered prior to January 1, 2018 (for occupancy periods after January 1, 2018), will be subject to the reduced 5.8% state sales tax (plus any applicable discretionary sales surtax).

  • Real Property Tax

In Florida, property taxes are assessed and collected on all real property and tangible personal property located within the county. The real estate tax bill is a combination of ad valorem taxes and non-ad valorem assessments. The tangible personal property tax bill is exclusively an ad valorem tax. Taxes are due and payable on November 1st of each year, with discounts provided for early payment. Florida homeowners can claim up to $50,000 in property tax exemptions through Florida Homestead on their primary residence. In cases where a property owner pays real estate taxes through an escrow account, the owner’s mortgage lender or servicer typically requests a copy of the tax bill from the County Tax Collector.  The lender or servicer will receive a copy of the tax bill and the owner will receive a copy of the notice. Mortgage lenders and servicers are required to pay the tax bill prior to expiration of the 4% discount period.

The following discounts apply for early payment:

  • 4% discount if paid in November
  • 3% discount if paid in December
  • 2% discount if paid in January
  • 1% discount if paid in February
  • The gross amount is due by March 31st
  • Tourist Development Tax

The Tourist Development tax, also known as “bed tax”, is a 5% tax imposed on the revenue generated from property rentals of 6 months or less. This bed tax is in addition to the Florida sales tax (Sarasota County 7% sales tax; Manatee County 6.5% sales tax).

  • Estate Tax

Florida residents do not pay estate or in heritance taxes. We strongly recommend new residents have their estate plan reviewed not only to determine whether the documents will be valid under Florida law, but also to determine whether the estate plan still achieves the desired results for the client and whether there are any state related issues.

  • Income Tax

Florida residents do not pay state income tax.

  • Corporate Business Tax

The Florida Corporate Income Tax rate is 5.5% and is assessed against entities that conduct business or earn or receive income in Florida, including out-of-state corporations. Even if there is no income, a Florida corporate income tax return may still have to be filed. Some entities are exempt from filing (generally pass through entities such as sole proprietorships or disregarded LLCs, estates and trusts and entities taxed under Subchapter S of the Internal Revenue Code). A CPA or tax advisor should be consulted about an entity’s tax situation and whether a conversion or reorganization might be advantageous.

  • Documentary Stamp Tax

Documentary stamp tax is levied on documents as provided under Chapter 201, Florida Statutes. Documents subject to the tax include, but are not limited to: Deeds, Bonds, Notes and written obligations to pay money, Mortgages, liens, and other evidences of indebtedness. The tax rate for documents that transfer an interest in real property is $.70 per $100 (or portion thereof) of the total consideration paid, or to be paid, for the transfer.

The tax rate on a written obligation to pay money is $.35 for each $100 (or portion thereof) of the obligation evidenced by the document. Tax is due on a document that contains a promise to pay a specific amount of money and is signed, executed, or delivered in Florida. For example, Demand notes, Term notes, Retail installment sale contracts, Leases with an unconditional promise to pay, Certain renewal notes, Title loans, Mortgages, Liens, and Other Evidences of Indebtedness.

  • Intangible Tax

This tax must be paid before the Clerk can accept any mortgage for record, and applies only to mortgages, agreements or contracts for deed, deeds of trust or other liens pertaining to real property. Intangible taxes are not levied on unsecured loans with an unconditional promise to pay. The tax rate of $.20 per each $100 on the amount of the mortgage or the amount financed.