Paying state taxes will be at the top of the list of things to do if you plan to settle or invest in one of the states with the greatest potential in the United States: Florida. That’s why today we’ve brought you a concise and clear guide to paying state taxes that will help you make a more conscious decision.
Paying state taxes: which are the most important?
According to the research organization Tax Foundation, Florida is one of the most attractive states for its low taxes, both for investors and residents (State of Florida Information Portal, n.d.). One of its great advantages is that no taxes are paid on income, investments or inheritances. As a resident, this allows you to retain most of your income. Even so, it is always necessary to know what the most important taxes are and understand how they work. Here we tell you:
Sales Tax
According to the Florida Department of Revenue (n.d.), any sale is taxable. And this sales tax is 6%. This is not an unknown tax. In most Latin American countries it is referred to as the value added tax (VAT).
However, there are some exceptions when talking about paying state taxes or taxes in states. For example, the lease, which is also considered a sale, is 5.5%.
Use taxes
It basically applies when sales tax was not paid, but the product or service was used. For example, if you buy a taxable product outside of Florida and then bring it into the state, you must pay taxes. You also pay if you buy exempt products that you would like to resell, but that in the end were for personal use.
Discretionary sales surcharge
By this he does not properly refer to the payment of state taxes, but to the county itself. This means that some Florida counties charge an extra fee on certain products. Even though it’s not a general tax, keeping it in mind will tell you how the cost of living is by county.
Transitional income taxes
Occasionally, some counties are also allowed to charge a transitional tax. That is, a tax collected eventually. This is charged on rentals, leases, hotels and other accommodation establishments.
The rate varies depending on the impact of tourism on the county. According to the Florida Department of Revenue (n.d.), this starts with 1% and goes up according to the number of visitors per year.
What are the dates for payment of state taxes?
Each person and company has a corresponding reporting period. According to the Florida Department of Revenue (n.d.), businesses must pay their sales and use taxes quarterly. However, this will depend on the amount of taxes to be collected.
If the amount raised is greater than $1,000, the collection will be monthly. If it’s between $501 and $1,000, it will be quarterly. Between $101 and $500, it will be weekly. And less than $100, it will be annual. It can be done online and even the state rewards advance payments.
What are the estimated amounts for paying state taxes?
For residents, the exact amount may depend on total household income, county, contributions and deductions. Because each person owns different things, taxes can vary considerably depending on the county and its assets. You can simulate your exact situation with tools such as SmartAsset.
And for property owners?
In the case of real estate, taxes also vary between counties. According to SmartAsset (2020), in Florida you must pay on average 0.83% of the value of the property. Which is very attractive considering the national average.
In this state, local administrations are responsible for these taxes. For that, you will need a property appraiser that will value the property every year and apply all exceptions. This is the person who could reduce the tax value of the property.
However, there are many exceptions that allow you to see good capital gains. Understanding them will be critical to making a decision about properties in Miami.
Without a doubt, Florida is one of the states best positioned to do business, acquire housing or even move. And, according to real estate mogul Grant Cardone (2020), thanks to quality of life and low taxes, Florida will continue to grow in both business and population. That is seen in the number of applications for both EB5 visa and E2 visa (for investors). So if you see Florida with eyes of opportunity and believe that the payment of state taxes favor you in your real estate and life projects, in PFS Realty Group you will find practical, diligent and professional advice. Do not hesitate to get in touch.