The Tax Benefits of Investing In Florida Real Estate

Real estate purchases have long been considered a “smart money move” for investors playing the long game. The most popular way to earn a high return on investment in your real estate purchase is through appreciation or the growth in property value over time. However, many don’t realize how lucrative real estate investments can be when paired with favorable tax incentives and renting.

Florida tax benefits make the Sunshine State a popular place to own real estate for this reason and many other lifestyle choices. If you’re looking for sunshine, nearby beach access, and a positive real estate investment opportunity, here are three reasons you may want to invest in Florida real estate.

In this article:

Florida Tax Benefits: No Personal Income Tax

Florida Tax Benefits: Capital Gains

Florida Tax Benefits: Other Property Tax Exemptions

Brock Built Neighborhoods in Florida

Florida Tax Benefits: No Personal Income Tax

Florida is one of few states without state personal income taxes. While the state taxes business corporations, a significant exception exists for sole proprietorships, partnerships, and certain LLCs. These three types of businesses have no specific business or corporate tax on revenue under Florida tax benefits, meaning you can save on real estate investments in Florida under these business entities.

For those who plan to purchase real estate as revenue-driving rental property, the lack of personal income tax and corporate tax on certain business entities makes Florida attractive. Paired with the high demand and healthy long-term and short-term rental market, real estate investments in Florida can be highly lucrative. In typical rental markets, the average rent increases only 3-5% per year; however, parts of Florida recently saw an 18.81% increase year-over-year.

As a homeowner in Florida, you may also be able to deduct the following real estate-related items on your income tax return:

  • Mortgage insurance premiums
  • Mortgage interest
  • Real estate property taxes
  • Closing costs and loan origination fees
  • Home improvements for medical purposes


Another Florida tax benefit is that the state does not assess estate or inheritance taxes. Therefore, anything willed to an individual will not undergo a tax penalty.

Florida Tax Benefits: Capital Gains

Because there is no personal income tax, Florida tax benefits also cover favorable capital gains rates. Real estate capital gains are the profits you earn from selling real estate, and capital gains taxes are the taxes you pay to receive those profits.

Capital gains in Florida real estate don’t exist. This means you don’t have to pay extra state taxes on capital gains from Florida real estate sales! (However, federal capital gains tax rules still apply.)

Florida is one of only eight states that do not tax capital gains. Georgia, for example, taxes capital gains as income, and the rate reaches 5.75%. California is one of the highest capital gains tax rates at 13.3% for the highest rate (taxed as ordinary income).

Florida Tax Benefits: Other Property Tax Exemptions

The collection of Florida tax benefits offers a variety of property tax exemptions and other benefits, including Homestead Exemption, the Save our Homes assessment limitation, and the Fallen Heroes Family Tax Relief Act.

Many states offer their versions of Homestead Exemption, and Florida is no different. When a homeowner makes their Florida property their permanent residence (or the permanent residence of a dependent), the homeowner may be eligible to decrease the property’s taxable value by up to $50,000. 

After the first year of an approved homestead exemption on the property, the assessment each following year cannot increase more than 3% or the percent change in the Consumer Price Index (CPI), whichever is less at the time. This is called the Save Our Homes assessment limitation.

The Fallen Heroes Family Tax Relief Act allows surviving spouses of a veteran or first responder who died in the line of duty to receive a total exemption on homestead property in Florida. It also includes exemptions for certain permanently and totally disabled veterans and surviving spouses of veterans.

Other property tax exemptions exist under Florida tax benefits for disabilities, senior citizens (age 65+), and widow(er)s.

Brock Built Neighborhoods in Florida

Living in Florida is sounding better and better! In addition to the spectacular Florida tax benefits, like no personal income tax or capital gains, Florida has an extremely mild, enjoyable, sunny climate with many outdoor activities to explore.

Love the beach? Florida’s got it. 

Love a day on the lake? Florida’s got it.

Love hiking, biking, tennis, or golf? Florida’s got it all.

In South Walton County, Brock Built is bringing its stylish, stunning home design to Florida. 

In Inlet Beach, Twin Palms is now selling breathtaking three-story homes with spectacular views from private rooftop terraces. Just minutes from shopping and dining at Rosemary Beach and steps away from the sand of quiet Inlet Beach, these homes offer spacious floorplans for relaxation and entertaining.

A short drive down 30A, you’ll find two new Brock Built communities in Santa Rosa Beach. The Shoal is an intimate community of one and two-story homes nestled among community green space just minutes from Choctawhatchee Bay. These homes have laidback floorplans featuring the best in coastal design. Brizo, situated right between the beach and the bay, features stylish two-story homes with luxurious details in a quiet retreat. 

If you’re ready to make Florida your home, send a note to our team to get exclusive news on these amazing new neighborhoods!

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