Florida Tax Advantages
Not all Florida home buyers are aware of the many tax advantages to living in Florida. In addition to year-round sunshine and picture-perfect beaches, Florida is also extremely tax-friendly. Florida’s tax incentives are not just for retirees, benefitting older and younger tax payers as well as young families. Here is a quick summary of the privileges to being a Florida resident:
No State Income Tax
Florida is one of nine states that boasts no state income tax which can save you thousands of dollars if you currently reside in a state with a higher income tax. Many states impose taxes that range from 3-9%.
Florida doesn’t tax retirement benefits. Exemptions include income from part-time work, social security income, pension income, and income from an IRA or 401 (k).
Property Tax Exemptions
If you buy a house in Florida and use it as your primary residence you can qualify for up to $50,000 in property tax exemptions. The Florida Save Our Homes Act also limits the annual growth in the assessed value of homesteaded properties up to 3% or the Consumer Price Index (CPI), whichever is lowest.
No Inheritance Tax
Florida residents and their heirs do not owe any estate taxes to the state on inherited properties, significantly reducing the tax liability on valuable properties. This lack of an inheritance tax is especially favorable today as real estate appreciates in value.
Florida is renowned as a favorable environment for both small and large businesses. In addition to insurance premium tax advantages as well as exemptions for clean energy operations, Florida does not tax limited partnerships or LLCs.
Not surprisingly, this combination of life in a beautiful climate with a reduced tax burden attracts new home buyers every year.