When it comes to investing in Florida, there are two things at stake: profitability and taxes in the United States. Today we will focus on the second. If your desire is to invest or move to the Sunshine State, but you still have doubts about the tax burden, this article interests you.

What are the most common taxes in the United States?

Whether you are a resident, citizen or investor, taxes are an unavoidable obligation. On this occasion, we would like to place special emphasis on those taxes related to real estate investments.

We make this emphasis because we still see potential in the sector. In fact, real estate investments in Florida have historically generated profitability. And going forward, according to analyst Jeff Rohde (2022), the market is expected to continue growing at a rate of 6% by 2023.

Knowing this, here we will present you some taxes in the United States that you must pay if you want to take advantage of the wave and settle in Florida:

Income taxes

Income tax is calculated based on your personal money inflows, either from direct employment or other sources.

Some states may charge federal taxes. Fortunately, Florida doesn’t have that burden, making it an attractive destination for high-income people.

Knowing this advantage, you should know that occasional income is also taxable in the United States and must be declared. These profits can be from the sale of stocks, bonds or real estate, as we will see now.

Property taxes

As in many parts of the world, the possession of real estate is taxable. In some Latin countries, this is called predial. In the United States it is called property tax.

Taxes in the United States are administered by local authorities, so conditions vary depending on where you live. Some properties that are considered taxable are:

  • factories
  • Condos
  • Springs
  • houses
  • and apartments.


Similarly, when buying the property you may have to pay an extra financial lien. On the other hand, if your purpose is to rent or rent the property, the cost for the financial payments will pass to your tenants.

Taxes in the United States: How Do They Work for Foreigners?

While the aforementioned taxes apply to resident foreigners, there are a number of additional documents that must be taken into account. This includes:

  • Your marital status,
  • Your income level,
  • The source of these,
  • If you have children,
  • The state in which you reside and more.

More than anything, they are personal characteristics that determine the amount of taxes to be paid in the United States.

Knowing this plays an important role, because according to Zaira Cortés (2021), the difference between someone married and someone single can be between 10% to 35% in the tax burden. Also, if you are head of household or widower, the conditions will not be the same.

That is why you have to know how to present yourself before the authority when paying taxes in the United States.

Now, with respect to property tax, according to the Internal Revenue Service (IRS, 2022), any real estate in the territory is taxable. It should be noted that the tax rate is the same for foreigners as for U.S. citizens.

Fortunately, according to the same entity, foreigners are also entitled to claim a refund in cases of withheld taxes or balances in favor.

As additional data, according to the Florida Department of Economic Opportunity (DEO, n.d.), in the next 7 years a growth of 7.5% of the labor market is projected. That means more demand for foreign labor and a possible easing of the tax burden in the future.

How to calculate these taxes in the United States?

To pay taxes in the United States, and particularly the property tax, the amount is calculated with a simple formula. In the case of Florida, you must first know the valuation of the property or assessed value.

This is obtained from the difference between the market value and the valuation limits. So, if your home is valued at $300,000, but has a valuation limit of $40,000, then the actual valuation will be $260,000 ($300,000 – $40,000).

Then, knowing this, you need to get the taxable value. For this, you need to know all the possible exemptions from your property.

In Florida, for example, one of the exemptions is when the goal is to fund schools. This exemption is usually $25,000. So, its actual taxable value would now be 235,000 (previous valuation of 260,000 – exemption of 25,000). The good news is that there are all sorts of exemptions that can smooth taxes in America.

Finally, the taxable value is multiplied by the so-called millage rate. According to Julia Kagan (2020), this is the local rate for calculating property taxes. In the case of Florida, it is 0.98% (H&R Block, 2021). Thus, the final tax liability for school real estate taxes will be $ 2,303.

If after reading this content you are interested in investing in properties in the United States, check out the options that at PFS Realty we have for houses for sale in Miami, there you will find many possibilities to achieve your goal.

This would be the final formula

This is the final formula according to the Florida Department of Revenue (n.d.):

  • Step 1: Property Valuation = Market Value – Assessment Limits.
  • Step 2: Taxable Value = Assessed Value – Exemptions.
  • Finally, step 3: Total Tax Liability = Taxable Value x Millage Rate.

It is worth mentioning that property taxes in the United States are paid every year in November. However, the process to obtain waivers begins the same month and the last deadline for payment without penalty is March 31.

What are the benefits of paying taxes in Florida?

In addition to being a federal tax-free state, Florida has some extra benefits. Deductions are tax discounts attributed to specific characteristics. According to Davis & Associates (2022), deductions range from being head of household to things as detailed as having energy-efficient homes. A simulator can give you an idea on a national level.

Additionally, the ease of procedures should be mentioned. From the Department of Revenue page you can:

  • Pay.
  • View your history.
  • Print certificates.
  • Apply to returns.

You just need to register.

As you can see, each case is unique and special, so understanding your situation and seeking expert advice could optimize your tax payments.

Does paying taxes in the United States entitle me to a visa?

The answer is: it depends. If you are an investor, there is already a visa created for you. It’s called the E-2 visa. This visa was created purely to facilitate economic interaction between the United States and the world. Therefore, if you want to invest a good sum of capital, you can surely apply.

Keep in mind that buying a home in the United States will not give you an investor visa. The main attribute that a holder of this visa has is the generation of employment. Real estate investment is considered as a passive investment and is subject to traditional taxes.

In conclusion, Florida is increasingly open to foreign investment and its procedures are becoming more affordable. However, this market can be variable and documentation sometimes tedious. Therefore, consulting with an expert will be essential to achieve your personal and investment goals. At PFS Realty we know the Florida real estate market. In addition, we understand the local context and tax-related laws in the United States. If your purpose is to invest or move to the Sunshine State, do not hesitate to contact us.


Cortés, Z. (2021, December 21). Single, married, or head of household: Which marital status pays the least tax? Telemundo 47. https://www.telemundo47.com/historias-destacadas/soltero-casado-o-jefe-de-familia-que-estado-civil-paga-menos-impuestos/2242793/#:~:text=De 20way 20similar 2C 20the 20singles,your top 20%20%2019%20manera%%20en%%%2C%%20solteros,sus%%2019%

Davis & Associates. (2022). Florida Tax Rates By Our Florida Accounting Firm. https://www.johndaviscpa.com/taxrates2.php

Department of Economic [DEO]Opportunity. (n.d.) Employment Projections. https://www.floridajobs.org/workforce-statistics/data-center/statistical-programs/employment-projections

Florida Department of Revenue. (n.d.). Property Tax Information for Taxpayers. Florida Department of Revenue. https://floridarevenue.com/property/Pages/Taxpayers.aspx

H&R Block. (2021). Florida Property Tax. https://www.hrblock.com/tax-center/filing/states/florida-property-tax/

Kagan, J (2020). Millage rate. Investopedia. https://www.investopedia.com/terms/m/millagerate.asp

Rohde, J. (2022). South Florida real estate market: Stats & trends for 2022. Roof Stock. https://learn.roofstock.com/blog/south-florida-real-estate-market

Internal [IRS]Revenue Service . (2022). Nonresident Aliens – Real Property Located in the U.S. https://www.irs.gov/individuals/international-taxpayers/nonresident-aliens-real-property-located-in-the-us