Florida Tax Guide — No Income Tax and Everything Else You Need to Know

Florida Has No State Income Tax — Here's What That Actually Means

The number one financial reason people move to Florida is simple: no state income tax. It's not a gimmick, not a limited-time thing, and not just for retirees. It's written into the Florida Constitution (Article VII, Section 5), which means it would take a voter-approved constitutional amendment to change it. That's about as permanent as tax law gets.

For someone earning $100K who moves from New York (where the state + city tax rate can hit 12%+), that's roughly $8,000–$12,000 back in your pocket every year. From California? Even more. From New Jersey or Connecticut? Similar story. That's not a tax deduction — that's cash you keep.

But "no income tax" doesn't mean "no taxes." Florida still collects revenue, and understanding where the money comes from will prevent some surprises. This guide covers every tax you'll encounter as a Florida resident, with real numbers for Tampa Bay's eight counties.

The Tax You Won't Pay — State Income Tax

Florida is one of nine states with no personal income tax. Here's what that covers:

• Wages and salary — zero state tax
• Self-employment income — zero state tax
• Retirement income (pensions, 401k withdrawals, IRA distributions) — zero state tax
• Social Security benefits — zero state tax (also exempt federally for most)
• Capital gains — zero state tax
• Rental income — zero state tax
• Investment dividends and interest — zero state tax

You still pay federal income tax on all of the above. Florida can't help you there. But the state portion? Gone.

How Much Do You Actually Save?

Household Income	Savings vs. New York	Savings vs. California	Savings vs. New Jersey	Savings vs. Illinois
$75,000	$4,200–$5,100	$4,500–$5,800	$3,900–$4,500	$3,700
$100,000	$6,100–$7,500	$6,800–$8,200	$5,400–$6,200	$4,950
$150,000	$9,800–$12,000	$11,500–$14,000	$8,200–$9,800	$7,400
$200,000	$13,500–$16,800	$16,000–$20,000	$11,000–$13,500	$9,900
$300,000	$21,000–$26,000	$27,000–$33,000	$17,000–$21,000	$14,800

Estimates include state income tax only. NYC residents save even more due to city income tax elimination.

These are real dollars — not theoretical. If you're earning $150K in New Jersey and relocate to Tampa Bay, you're saving roughly $9,000/year in state taxes alone. Over 10 years, that's a new kitchen renovation, a boat, or a significant chunk of your kids' college fund.

Want to see exactly how the numbers work for your situation? Bankrate has tax comparison calculators that let you plug in your specific income and deductions.

Sales Tax — The Tax You Will Pay

Florida's base state sales tax is 6%. Each county adds a discretionary surtax on top. Here's what you'll pay in Tampa Bay:

County	State Rate	County Surtax	Total Sales Tax
Hillsborough	6%	1.5%	7.5%
Pinellas	6%	1%	7.0%
Pasco	6%	1%	7.0%
Hernando	6%	0.5%	6.5%
Polk	6%	1%	7.0%
Manatee	6%	1%	7.0%
Sarasota	6%	1%	7.0%
Citrus	6%	1%	7.0%

Hillsborough County has the highest sales tax in the metro at 7.5% due to the transportation surtax voters approved. That extra 0.5% funds transit improvements and road projects.

What's Taxed and What's Not

Taxed: Most retail purchases, electronics, furniture, clothing, restaurant meals, prepared food, alcohol, cars, boats, services like pest control and security monitoring.

Not taxed: Groceries (unprepared food), prescription medications, some medical equipment, residential rent (though commercial rent is taxed at 2% state + surtax).

The grocery exemption is important — your weekly Publix run for unprepared food is tax-free. But the rotisserie chicken from the deli? Taxed, because it's prepared food.

Sales Tax on Big Purchases

If you're buying a car, boat, or other major purchase, Florida caps the sales tax on the first $5,000 of the purchase price at the state rate, then the full rate applies above that. For vehicles, you pay the sales tax when you register it at the DMV — and there's no getting around it by buying in a lower-tax county. The rate is based on where you live, not where you buy.

Property Tax — The Big One

Property tax is where Florida actually gets you. Without an income tax, local governments rely heavily on property taxes to fund schools, fire rescue, libraries, and infrastructure. The rates vary significantly by county and even by municipality.

How Florida Property Tax Works

Florida property tax is based on millage rates — mills per dollar of assessed value. One mill = $1 per $1,000 of taxable value. The total millage includes county, city, school district, and special district levies.

Your taxable value is your assessed value minus exemptions (like the homestead exemption, which knocks $50,000 off your taxable value).

Property Tax Rates by County

County	Approximate Total Millage	Tax on $400K Home (with Homestead)	Tax on $400K Home (no Homestead)
Hillsborough	19.5–21.5 mills	$6,825–$7,525	$7,800–$8,600
Pinellas	19.0–22.0 mills	$6,650–$7,700	$7,600–$8,800
Pasco	18.5–20.5 mills	$6,475–$7,175	$7,400–$8,200
Hernando	16.5–18.0 mills	$5,775–$6,300	$6,600–$7,200
Polk	18.0–20.0 mills	$6,300–$7,000	$7,200–$8,000
Manatee	17.5–19.5 mills	$6,125–$6,825	$7,000–$7,800
Sarasota	16.0–18.5 mills	$5,600–$6,475	$6,400–$7,400
Citrus	15.5–17.5 mills	$5,425–$6,125	$6,200–$7,000

Millage rates vary by municipality and special district. These are approximate ranges for 2025-2026 tax year.

Important: The assessed value for tax purposes isn't necessarily the market value. Florida has the "Save Our Homes" cap that limits increases on homesteaded properties to 3% per year or the CPI, whichever is less. So if you bought your home in 2020 and it's appreciated 40%, your assessed value may have only increased 15–18%. This creates a massive tax advantage for long-term homeowners.

The Homestead Exemption — Don't Skip This

If you buy a home and make it your primary residence, you qualify for the Florida Homestead Exemption. This removes $50,000 from your taxable value — saving you roughly $875–$1,100/year depending on your county's millage rate. It also activates the Save Our Homes cap, which protects you from large tax increases going forward.

File between January 1 and March 1 of the year after you purchase. Miss this deadline and you lose an entire year of savings. Read the full breakdown in our Homestead Exemption guide.

Real Estate Transaction Taxes

When you buy or sell property in Florida, several taxes apply:

Documentary Stamp Tax

Florida charges $0.70 per $100 of the sale price (called "doc stamps") on the deed. On a $400,000 home, that's $2,800. Typically paid by the seller in Tampa Bay, though this is negotiable.

There's also a doc stamp tax on the mortgage: $0.35 per $100 of the loan amount. On a $360,000 mortgage, that's $1,260. Paid by the buyer.

Intangible Tax

A one-time tax on new mortgages: $0.002 per dollar (2 mills) of the mortgage amount. On a $360,000 mortgage, that's $720. Paid by the buyer at closing.

Title Insurance

Not a tax, but a required cost. Florida title insurance rates are set by the state, so they don't vary by provider. On a $400,000 purchase, expect about $2,075 for the owner's policy.

When you're ready to run the full numbers on a purchase, LendingTree lets you compare closing cost estimates from multiple lenders to see the complete picture.

Tourist Development Tax (Bed Tax)

If you're planning to rent out a property short-term (Airbnb, VRBO), you'll need to collect and remit the Tourist Development Tax on top of sales tax. These rates vary by county:

County	Tourist Tax Rate	Combined with Sales Tax
Hillsborough	6%	13.5%
Pinellas	6%	13.0%
Pasco	5%	12.0%
Manatee	5%	12.0%
Sarasota	5%	12.0%
Polk	5%	12.0%
Hernando	5%	11.5%
Citrus	5%	12.0%

That's a significant tax load on short-term rentals. Guests pay it, but you're responsible for collecting and remitting it — either through the platform (Airbnb and VRBO handle some counties automatically) or directly to the county tax collector.

Business Taxes in Florida

Corporate Income Tax

Florida does have a corporate income tax — 5.5% on income over $50,000 for C-corporations. However, S-corps, LLCs, and sole proprietorships pass through to your personal return, which means no state tax on business income for most small business owners.

Tangible Personal Property Tax

If you own a business, you're taxed on your business equipment, furniture, and fixtures — anything that isn't real estate. You file a DR-405 form annually by April 1. There's a $25,000 exemption, so most home-based businesses and small operations owe nothing. But if you have significant equipment, this tax adds up.

Commercial Rent Tax

Florida charges sales tax on commercial lease payments. The state rate dropped to 2% (from 5.5% over recent years) plus the county surtax. So in Hillsborough, you're paying 3.5% tax on your office lease. This is unusual — most states don't tax rent — and it's a real cost for businesses.

Reemployment Tax (Unemployment)

If you have employees, you pay Florida's reemployment tax (their version of unemployment insurance) on the first $7,000 of each employee's wages. Rates vary by industry and your claims history, starting around 2.7% for new employers.

How Florida Compares to High-Tax States

Here's the full picture — not just income tax, but total state and local tax burden:

Category	Florida	New York	California	New Jersey	Illinois	Connecticut
Income tax	0%	4–10.9%	1–13.3%	1.4–10.75%	4.95% flat	3–6.99%
Sales tax (typical)	7%	8%	7.25–10.25%	6.625%	6.25–10.25%	6.35%
Property tax (effective rate)	0.8–1.1%	1.4–2.5%	0.7–1.1%	2.2–2.5%	2.0–2.5%	1.6–2.2%
Estate/inheritance tax	None	Yes	Yes	Yes (both!)	Yes	Yes
Overall tax burden rank	Low	Highest	Very High	Very High	High	Very High

The bottom line: Florida's property taxes are slightly higher than California's but dramatically lower than New Jersey's. And without income tax or estate tax, the total package makes Florida one of the lowest overall tax burden states for high earners, retirees, and business owners.

Specific Savings Scenarios

Scenario 1: Couple earning $200K, moving from New Jersey

• NJ income tax saved: ~$11,500/year
• NJ property tax difference (on similar home): ~$4,000–$6,000/year savings
• No NJ estate/inheritance tax on assets
• Net annual savings: $15,000–$17,000

Scenario 2: Retiree couple with $80K pension + Social Security, moving from New York

• NY income tax saved: ~$4,200/year
• No tax on Social Security (also exempt federally at this income)
• FL homestead exemption savings: ~$1,000/year
• Net annual savings: $5,000–$6,000

Scenario 3: Remote worker earning $150K, moving from California

• CA income tax saved: ~$12,000–$14,000/year
• Higher FL property tax partially offsets (maybe $1,500 more)
• Higher FL insurance costs partially offset (maybe $2,000 more)
• Net annual savings: $8,000–$10,000

Tax Calendar for Florida Residents

Date	What's Due
January 1	Homestead exemption eligibility date (must own and occupy by this date)
January 1 – March 1	File homestead exemption application
April 1	Business tangible personal property tax return due
November 1	Property tax bills mailed
November (by 30th)	Early-pay 4% discount on property taxes
December 31	Last day for 3% discount on property taxes
February 28	2% discount deadline
March 31	1% discount deadline
April 1	Property taxes due at full amount — delinquent after this date

Pro tip: Pay your property taxes in November and take the 4% discount. On a $6,000 tax bill, that's $240 saved for writing a check a few months early. It's the easiest money you'll ever make.

Taxes That Catch People Off Guard

Insurance Costs Replace Some Tax Savings

Florida's no-income-tax advantage is partially offset by higher insurance costs — particularly homeowners insurance and auto insurance. Budget $2,500–$5,000/year for homeowners insurance (more in flood zones or coastal areas) and auto insurance rates that rank among the highest in the nation due to uninsured motorists and litigation.

Compare rates before you move. Policygenius lets you shop homeowners and auto insurance across multiple carriers to find the best rate for your situation.

The "Snowbird Tax" Trap

If you're maintaining residences in both Florida and another state, be very careful about establishing your Florida domicile. States like New York and California aggressively audit former residents. You need to actually live in Florida for more than 183 days, change your driver's license, register to vote here, update your estate documents, and file a Declaration of Domicile with your county clerk. Half-measures can result in your former state claiming you owe income tax.

Tangible Personal Property for Home-Based Businesses

If you run a business from home with more than $25,000 in equipment (computers, monitors, printers, furniture), you may owe tangible personal property tax. File the DR-405 form by April 1 even if you think you're under the threshold — failure to file can result in the Property Appraiser estimating your value, usually higher than reality.

CDD Fees

Some newer communities (especially in Wesley Chapel, Riverview, and Lakewood Ranch) have Community Development Districts that levy their own assessments — sometimes $1,500–$3,000/year on top of property taxes and HOA fees. These aren't technically taxes, but they're non-negotiable and show up on your tax bill. Always check for CDDs before buying in a new-construction community.

Frequently Asked Questions

Does Florida tax retirement income?

No. Pensions, 401(k) distributions, IRA withdrawals, Social Security, and annuity income are all tax-free at the state level. This is one of the biggest reasons retirees choose Florida.

Is there a Florida estate or inheritance tax?

No. Florida has no estate tax and no inheritance tax. Florida even has constitutional protection against it — Article VII, Section 5(a) prohibits a state estate tax beyond the federal credit (which was repealed in 2005).

Do I have to file a Florida state tax return?

No. There is no personal income tax return to file in Florida. If you own a C-corporation, you'll file a corporate return. Otherwise, you only deal with property taxes and sales tax.

What if I work remotely for a company in a state with income tax?

You pay tax based on where you physically work, not where your company is located. If you live in Florida and work from home for a New York company, you owe no state income tax. However, some states (looking at you, New York) have "convenience of the employer" rules that can complicate this. Consult a tax professional for your specific situation.

How does Florida fund its government without income tax?

Sales tax is the biggest revenue source, followed by corporate income tax, documentary stamp tax, tourism taxes, lottery revenue, and federal transfers. Property taxes fund local governments and schools. The model works because Florida's population growth and tourism generate massive sales tax revenue.

Are property taxes higher in Florida to compensate for no income tax?

Compared to national averages, Florida's property tax rates are moderate — lower than New Jersey, Illinois, Connecticut, and New York, but higher than California and Hawaii. The effective rate on a homesteaded property in Tampa Bay is typically 0.8–1.1% of market value.

Thinking about relocating to Tampa Bay? Barrett Henry has been helping families move to Tampa Bay for over 23 years. The NOW Team — Barrett Henry, REALTOR®