IS SOUTHEAST FLORIDA BECOMING A TAX HAVEN?

THE REAL DEAL reports that many south Florida brokerages are targeting “top-earning hedge funders, real estate bigwigs, big-time entrepreneurs and CEOs from states such as New York, New Jersey, Connecticut, California and Illinois — places with state income taxes as high as 13.3 percent, and even city taxes in the case of New York City. Florida, on the other hand, has no state income tax.”

Paradise, is the “nickname” for southeast Florida.  Properties abound from oceanfront mansions and condos to inland golf properties and many other alternatives. The warm weather is the 2nd biggest attraction, after tax savings.

Nelson Gonzalez of EWM Realty International refers to new buyers as “tax refugees.” He relates a story of being in an elevator with three different buyers and asking, “Why Miami, why are you moving from New York?” “Taxes,” says one, and the others say, “That’s why I am here.” He further says that “Hedge fund guys make $50-$150 million a year and come down to Miami and buy a $10-$20 million property and due to tax savings, they get a free house in 2-5 years and get to live in paradise.”

Sounds like a good idea, yes?

Note that The Tax Cuts and Jobs Act passed in December limits ability of taxpayers to deduct state and local tax from 2018 federal and local income taxes. An additional incentive is the almost 2% tax on assessed value for property taxes.

Financial firms are looking in particular at Boca Raton and West Palm Beach according to the Director of Keyes’ commercial division. High end home sellers are slashing their prices. Developers are including flooring and wall treatments. Furniture packages are offered for an extra fee.

Remember that what happens in Miami shifts northward to Broward and Palm Beach Counties.