Last Updated: April 2026
Florida is one of nine US states with no state income tax, making it consistently attractive for high earners, retirees, and remote workers fleeing high-tax states like New York and California. With no income tax, no estate tax, and no gift tax, Florida's state tax burden falls primarily on property taxes (moderated by the homestead exemption), sales tax, and documentary stamp taxes on real estate transactions.
This guide explains what Florida residents actually pay in state taxes, how the homestead exemption dramatically reduces property tax for primary residents, the Save Our Homes cap, and the full picture of Florida's tax costs beyond the 'no income tax' headline.
Florida's lack of state income tax is its defining tax characteristic. For comparison:
| State | Top State Income Tax Rate | Annual Tax on $200,000 Salary (approx) |
|---|---|---|
| Florida | 0% | $0 |
| Texas | 0% | $0 |
| New York | 10.9% | ~$18,000–20,000 |
| California | 13.3% | ~$22,000–25,000 |
| New Jersey | 10.75% | ~$16,000–18,000 |
| Illinois | 4.95% flat | ~$9,900 |
For a married couple with $500,000 combined income moving from New York City to Florida, the annual state + city tax savings can exceed $50,000 — a compelling financial reason for the ongoing migration from high-tax states.
For remote workers: establishing Florida domicile requires genuine life changes — Florida driver's licence, Florida voter registration, primary home in Florida, updating legal documents (will, trusts) to reflect Florida domicile. Simply buying a Florida condo while maintaining a New York job and home is unlikely to establish Florida domicile for tax purposes. New York (and California) audit former high-income residents' claimed domicile changes aggressively.
Florida property taxes are set by counties and school districts. Effective rates vary significantly by county: Miami-Dade approximately 0.97%; Broward approximately 1.07%; Palm Beach approximately 0.87%; Hillsborough (Tampa) approximately 0.98%; Pinellas approximately 0.82%; Duval (Jacksonville) approximately 0.89%; Orange (Orlando) approximately 0.94%.
Florida's homestead exemption provides: first $25,000 of assessed value exempt from all property taxes; second $25,000 (applicable to assessed value $50,001–75,000) exempt from school district taxes only. Total: up to $50,000 reduction in assessed value, worth approximately $750–1,100/year in property tax savings depending on millage rate. Eligibility: Florida must be your primary residence as of January 1; you must apply by March 1. The exemption is automatic for subsequent years if circumstances don't change.
The Save Our Homes (SOH) amendment limits annual increases in assessed value for homesteaded properties to 3% or the CPI increase, whichever is lower. In rising markets, this creates a significant disconnect between market value and assessed value for long-term homeowners — saving thousands per year. The portability amendment allows homeowners to transfer their SOH benefit to a new Florida primary residence — up to $500,000 can be ported. This makes long-term Florida homeowners reluctant to move, even within the state.
Florida's state sales tax is 6%, plus a county surtax: Miami-Dade 1% = 7%; Broward 0% = 6% (no surtax); Palm Beach 1% = 7%; Hillsborough 1% = 7%; Orange 0.5% = 6.5%. Exempt from sales tax: most groceries (unprepared food); prescription and OTC drugs; agricultural products; most medical items. Florida sales tax applies to services more broadly than some states — certain commercial services, commercial leases, and information services may be taxable.
Florida's documentary stamp tax on real estate deeds: $0.70 per $100 of consideration (seller typically pays). Miami-Dade County: $0.60 per $100 deed + $0.45 per $100 mortgage = 1.05% on a financed purchase. This is a significant closing cost — on a $500,000 home: approximately $3,500 in documentary stamps. There is also a documentary stamp tax on mortgages: $0.35 per $100 (all counties) plus Intangible Tax of $2 per $1,000 of new mortgage principal — on a $400,000 mortgage, approximately $2,200 in combined stamps and intangible tax.
Florida businesses (not individuals) pay tangible personal property tax on business equipment and furniture — 1.5–3% of assessed value. There is a $25,000 exemption per business location. Not applicable to personal (non-business) property.
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Questions about establishing Florida domicile, the homestead exemption, or your federal tax obligations as a Florida resident? TaxHub connects you with licensed CPAs who can advise on your specific situation.
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Talk to a Florida CPA About Your Taxes →Florida residents pay: federal income tax (normal US rates — no Florida exemption); federal FICA (Social Security and Medicare for employed); property tax (0.8–1.1% effective rate for most counties; homestead exemption reduces this for primary residents); sales tax (6–7.5% on most purchases; groceries and prescription drugs exempt); documentary stamp tax on property purchases (0.6–0.7% plus mortgage tax); vehicle registration fees; fuel taxes (~$0.32/gallon for gas in addition to federal gas tax). For retirees with investment income: Florida collects no state tax on dividends, capital gains, or interest — all taxed only at the federal level. This is why Florida is particularly attractive for investment income, Social Security income, and pension income that would be partially taxed in other states.
The Florida homestead exemption reduces the assessed value of your primary residence by up to $50,000 for property tax purposes. First $25,000 of assessed value: exempt from all property taxes (school, county, city). Second $25,000 (for assessed values $50,001–75,000): exempt from all taxes except school district taxes. Savings: approximately $750–1,100/year depending on county tax rate. To qualify and apply: (1) Florida must be your permanent primary residence as of January 1 of the tax year; (2) Apply through your county property appraiser by March 1 (the deadline is strict); (3) Provide Florida driver's licence or Florida ID, Florida vehicle registration, or Florida voter registration as proof of primary residency; (4) Once granted, the exemption renews automatically unless you sell, rent the property, or change primary residence. Homestead also protects your primary residence from forced sale (except for mortgages, property tax liens, and certain other debts) — a significant creditor protection benefit.
Correct — Florida has no state income tax, so there is no Florida tax on Social Security benefits, pension income, IRA or 401(k) distributions, or investment income. Retirees pay only federal income tax on these sources. Federal treatment of Social Security: 0–85% of benefits are included in federal taxable income depending on combined income (provisional income). If combined income exceeds $44,000 (married), 85% of Social Security is taxable federally. Florida itself adds zero state tax on top. Compare to states like Minnesota (taxes up to 85% of SS benefits), Missouri (taxes SS above certain incomes), or California (taxes all SS income) — Florida provides complete state-level exemption simply by having no income tax.
The Save Our Homes (SOH) portability amendment allows Florida homeowners to transfer up to $500,000 of their accumulated SOH benefit (the gap between market value and assessed value) to a new Florida primary residence. Example: you own a home worth $600,000 but assessed at $350,000 due to 20 years of SOH capping — you have a $250,000 SOH benefit. If you sell and buy a new $800,000 Florida home, you can apply your $250,000 portability to the new home — reducing its assessed value to approximately $550,000. To use portability: apply to your new county property appraiser within 3 years of abandoning the previous homestead; file the Portability Application (DR-501T) when applying for the new homestead exemption. Portability is 'upsize portable' — you get the full amount transferred to a more expensive home. For a 'downsize move', the portable benefit is prorated: (new home value / old home value) × SOH benefit.
No — Florida abolished its estate tax in 2004 after changes to federal estate tax law eliminated the state estate tax credit that Florida's tax was based on. Florida has no estate tax, no inheritance tax, and no state gift tax. For estates of Florida residents: only the federal estate tax applies, with a $13.61M exemption (2024) — meaning the vast majority of estates pass entirely tax-free. This is a major advantage over states like New York (estate tax from $7.16M), Massachusetts ($2M threshold), Oregon ($1M threshold), or New Jersey (which reinstated an estate tax). Florida's complete absence of estate, inheritance, and gift taxes makes it particularly attractive for wealth transfer planning. Families with significant assets often establish Florida domicile specifically to eliminate estate tax and preserve generational wealth.