Florida
Florida state tax preparation
Florida has no personal income tax, making it a popular state for retirees and high earners. Florida businesses face a corporate income tax (for C corps) and tangible personal property tax. Federal returns plus multi-state coordination is what most Florida residents need.
How does Florida state taxation work?
Florida has no personal income tax. Florida is one of nine states with no state-level individual income tax. State revenue is collected through sales tax, corporate income tax (for C corporations only), and property tax. Florida residents file federal returns only for personal income tax purposes.
What Florida tax topics come up most?
- No personal income tax. Wages, business income, capital gains, retirement distributions, none are taxed at the Florida state level. Federal tax still applies.
- Florida corporate income tax. Florida C corporations pay a corporate income tax (5.5 percent as of 2024, with periodic rate adjustments). Florida S corporations and LLCs taxed as partnerships pass income through to owners and do not pay state income tax at the entity level.
- Florida tangible personal property tax. Florida businesses pay an annual property tax on tangible business assets (equipment, furniture, fixtures) above a $25,000 exemption. Filed locally with the county property appraiser.
- Florida sales tax. 6 percent state plus local discretionary sales surtax up to 2.5 percent. Various exemptions for groceries, prescription drugs, and certain professional services.
- Florida residency rules. Florida residency is established through documented intent and physical presence. The state has no minimum-day requirement, but other states can challenge a residency move.
- Homestead exemption. Florida residents can claim a homestead exemption on their primary residence, reducing property tax by a fixed amount.
- Save Our Homes cap. Florida limits annual increases in homestead property assessments to the lesser of 3 percent or the change in CPI.
How does Florida residency work for snowbirds?
Florida is a popular destination for snowbirds splitting time between Florida and a higher-tax state. Establishing Florida residency requires documenting intent and physical presence, with consistent factual evidence.
Steps to establish Florida residency:
- File a Florida Declaration of Domicile with the county clerk where you reside.
- Obtain a Florida driver's license and surrender the previous state's license.
- Register vehicles in Florida.
- Register to vote in Florida.
- Update banks, brokerages, and professional advisors with Florida address.
- Spend more than 183 days in Florida (the practical day-count threshold for most state challenges).
- Move primary medical and professional relationships to Florida if possible.
The previous state may still challenge the residency change for 2-5 years. Particularly aggressive states include New York, California, and Massachusetts. Documentation matters more than intent statements.
Florida tax FAQs
Do I need to file a Florida state income tax return?
No. Florida has no personal income tax. Federal returns are filed only.
Does my Florida S corporation owe Florida state tax?
No. Florida S corporations and LLCs taxed as partnerships do not pay Florida income tax at the entity level. Income passes through to owners. Florida C corporations, however, pay a 5.5 percent corporate income tax.
What about Florida tangible personal property tax for my business?
Florida businesses with tangible personal property (equipment, furniture, fixtures) above a $25,000 exemption file an annual return with the county property appraiser. Below the exemption, an initial filing may still be required to claim the exemption.
Can I just move to Florida from New York to avoid New York taxes?
Yes, with proper documentation. New York aggressively challenges residency departures and can audit former residents for several years. The cleanest moves involve a documented Declaration of Domicile, Florida driver's license and voter registration, a primary residence in Florida, more than 183 days physical presence in Florida, and severing significant New York ties (closing the New York residence or converting it to a vacation property, moving banks and advisors, etc.).
Does Florida tax retirement income?
No. Florida has no personal income tax, including no tax on Social Security, pensions, IRA distributions, 401(k) distributions, or other retirement income.
What about Florida hurricane and disaster relief?
After federally-declared disasters, Florida residents may qualify for casualty loss deductions on the federal return (subject to limitations). Specific provisions vary by disaster declaration. We track current relief provisions during preparation.
Ready when you are
Start with a fifteen minute conversation. We will figure out the right fit together.