Florida LLC for Real Estate Investors
Property investment guide for foreign nationals: Miami, Orlando & beyond
$0 State Tax
No income tax
$125 Filing
Articles of Org
$138.75/yr
Annual Report (May 1)
15% FIRPTA
Withholding on sale
Why Foreign Investors Choose Florida
Florida is the top destination for international real estate investment in the United States.
Key Benefits
- No personal or corporate state income tax
- Strong property rights for foreigners
- Exceptional vacation rental income
- Historical appreciation in key markets
Investment Focus
- Miami luxury condos
- Orlando vacation rentals
- Coastal waterfront properties
- Pre-construction opportunities
Property Types for Investment
Condos
Low maintenance
Single Family
Higher returns
Vacation
High income
Pre-Const
Appreciation
Multi-Family
Diversified
Commercial
Retail/Office
Popular Florida Markets
Miami
Luxury, intl hub
Orlando
Vacation rentals
Ft. Lauderdale
Waterfront
Tampa
Growing market
Palm Beach
Ultra-luxury
Naples
Retirement, golf
Financing Options for Foreign Buyers
Foreign nationals can obtain mortgages in Florida, though terms differ from US citizens.
Typical Terms
- Down Payment: 30-40% required
- Interest Rates: 0.5-1.5% higher than conventional
- Documentation: Proof of income, bank statements, passport
- Lenders: HSBC, Citibank, specialty foreign national lenders
Why Use an LLC for Florida Real Estate?
LLC Advantages
- Liability protection from lawsuits
- Privacy - name not on property records
- Easier estate planning, avoid probate
- Clean structure for multiple owners
When Personal Ownership Works
Consider Personal Ownership If
- Primary residence (homestead exemption)
- Want simplicity - no annual LLC fees
- Need better mortgage rates
Florida LLC vs Delaware/Wyoming
For Florida real estate, form your LLC in Florida.
Why Florida LLC is Better
- Delaware LLC still requires FL foreign qualification
- No tax advantage - property is in FL anyway
- One state's reports instead of two
- Lower total cost
What is FIRPTA?
FIRPTA requires buyers to withhold 15% of the gross sales price when purchasing real property from a foreign seller. This is remitted to the IRS as prepayment of capital gains tax.
Key Points
- Applies when you SELL, not when you buy
- 15% of gross price (not profit)
- Often results in over-withholding
- File tax return to claim refund
- Can apply for reduced withholding before closing
LLC Does NOT Avoid FIRPTA
An LLC with any foreign member is treated as a foreign person for FIRPTA purposes. Using an LLC does NOT avoid FIRPTA withholding when you sell.
FIRPTA Exemption for Residence
If the buyer will use the property as a residence:
Reduced Rates
- Sales price $300,000 or less: 0% withholding
- $300,001 to $1,000,000: 10% withholding
- Above $1,000,000: 15% withholding
Formation Process
Steps 1-4
- Choose LLC name (search Sunbiz.org)
- Designate FL Registered Agent
- File Articles of Organization ($125)
- Apply for EIN (Form SS-4)
Steps 5-7
- Create Operating Agreement
- Open US Bank Account
- Purchase property in LLC name
Registered Agent Requirement
Florida requires a registered agent with a physical Florida address. Foreign investors need a registered agent service ($50-200/year).
EIN for Foreign Owners
Foreign owners without SSN/ITIN must apply for EIN by mail or fax using Form SS-4. Takes 4-6 weeks.
Florida LLC Costs
| Item | Cost | Frequency |
|---|---|---|
| Articles of Organization | $125 | One-time |
| Registered Agent | $50-200 | Annual |
| Annual Report | $138.75 | Annual (May 1) |
| Operating Agreement | $500-1,500 | One-time |
| Tax Return Prep | $500-2,000 | Annual |
| BOI Report (FinCEN) | $0 | Initial + updates |
State Requirements
Florida Vacation Rental Requirements
- Register with FL DBPR
- Obtain vacation rental license
- Collect FL sales tax (6%)
- Collect tourist development tax (4-6%)
Local Restrictions
Miami Beach
Min 6-month rentals most areas
Orlando
Permissive in resort zones
Ft. Lauderdale
Varies by neighborhood
Condo HOA Restrictions
Many condo associations prohibit or restrict short-term rentals. Always review HOA documents (Declaration of Condominium, Rules and Regulations) before purchasing a condo for vacation rental purposes.