The Sunshine State is one of the best locations nationwide for foreign investors seeking to own rental property. The list of benefits includes a recurring source of passive income and the possibility to invest the proceeds from rent in other properties.Ā
In this article, you will find out how to buy Florida rental property from abroad.
Are Foreign Nationals Allowed to Own Rental Property in Florida?
No US law restricts the ability of a foreign national – resident or non-resident – to purchase commercial or residential property for rental purposes. As long as the investor meets the applicable regulations, it is possible to buy property without the involvement of any government agency.Ā
Please note that buying a property in the United States does not affect the investor’s immigration status. Hence, owning a rental property in Florida will not grant a foreign investor any privileges or rights.
To become a permanent resident or obtain work authorization, foreign investors must consult with an experienced immigration attorney to find a solution tailored to the particularities of each case.Ā
How to Buy a Property for Rental in Florida from Abroad – Tax Implications
Buying rental property in Florida as a foreign national requires a careful approach. One of the hassles for foreign owners of rental properties is navigating the US tax system. Under US law, all the income generated by the amount paid in rent is subject to taxation.
The Internal Revenue Service (IRS) has specific guidelines that foreign property investors must abide by. Otherwise, it may result in hefty fines and even more severe consequences.
Whether the foreign investor is theoretically a “non-US resident,” the IRS has its own system to determine what a US resident is for tax purposes.
Using a method called the “Substantial Presence Test,” the federal agency identifies how many days the investor has been physically present in the United States. Another fundamental aspect of foreign-owned property in Florida is international tax liability.
Depending on the investor’s country of origin, it may affect his or her tax liability abroad. In such cases, it is crucial to identify whether the country has a tax treaty with the United States.
How to Buy a Property for Rental in Florida from Abroad – Is it Possible to Secure a Loan?
In most cases, non-citizens prefer to buy property in Florida by paying all cash. US law requires that any transactions paid all cash with an amount superior to US$10,000 must be reported to the Federal Government.
One of the biggest challenges involved in the process of buying US property from abroad is obtaining financing. While it is possible to obtain financing in specific circumstances, these cases are exceptions to the rule, as most foreign nationals cannot secure a loan.
Fortunately, the real estate market in Florida offers options at all price levels, facilitating the conditions for cash buyers. In addition to the amount paid on the property, other costs included in the purchase include title search, recording costs, and legal fees.
Do You Want to Buy a Property for Rental in Florida from Abroad? – Waste no Time with Uncertainty
With years of experience representing clients in business transactions, Attorney Romy B. Jurado willingly wants to help you succeed. Immediately contact us by calling (305) 921-0976 or emailing [email protected] for zealot legal representation.Ā
